A trader at Localbitcoins and Paxful pleaded guilty to charges related to some bitcoin scams. The U.S. Department of Justice alleges that the trader intentionally sold bitcoin to victims of scams.
Bitcoin trader facing jail time
The United States Department of Justice (DOJ) announced last week that a Boston man pleaded guilty in federal court to his role in two bitcoin fraud schemes. Austin Nedved “pleaded guilty to helping and encouraging electronic fraud and money laundering conspiracy,” the DOJ said, adding that the 29-year-old is currently “in custody serving a sentence for another conviction for fraud”. The ad states:
Nedved admitted that he ran a business in which he bought and sold digital currencies, including bitcoin, for cash. Nedved advertised his services under the screen name ‘usmc1991’ on Localbitcoins.com and Paxful.com.
The Justice Department described that he “helped and encouraged romance and lottery schemes targeting vulnerable victims.” In romance schemes, victims believe they are in love with scammers and send money in the form of bitcoin. In lottery schemes, victims believe that “they can obtain considerable lottery prizes or government grants by sending money for administrative expenses or fees to fraudsters,” described the DOJ.
In late 2017, a scam artist impersonated an American oil company owner and managed to make a 78-year-old man fall in love with him. Never meeting in person, she agreed to marry him. The scammer then told her that her oil company “suffered an accident abroad in which people died, and that he needed money to settle the obligations arising from the accident with a foreign government.” He convinced her that unless she sent him a few bitcoins to pay the settlement, he would not be able to return to the United States and marry her.
The victim, who has never bought bitcoin before, contacted Nedved in June 2018. They met in a parking lot in Maine and she bought about $ 100,000 in BTC in cash. Nedved then transferred the coins to a scam-controlled wallet.
The DOJ claimed that when Nedved accepted $ 100,000 from the 78-year-old lady, he knew she was a victim of romantic fraud. However, he and his co-conspirator took another $ 40,000 from her. According to the DOJ:
Despite knowing or being deliberately blind to the fact that his customers were victims of fraud, Nedved sold bitcoin to them so that they could send money to fraudsters.
In total, Nedved and his co-conspirators sold more than $ 630,000 in BTC to victims of bitcoin scams, the DOJ claimed, claiming that they knew “that money was a recipe for romance and lottery scams and other illegal activities”.
The Justice Department explained that “The charges of assistance and complicity in electronic fraud provide for a sentence of up to 20 years in prison, three years of supervised release and a fine of up to $ 250,000 or twice the gross gain or loss, whichever is greater. greater. ”In addition,“ The money laundering conspiracy charge provides for a sentence of up to 20 years in prison, three years of supervised release and a fine of up to $ 500,000 or double the amount of funds involved in the financial transactions that were the subject of conspiracy. ”
What do you think of the charges against this bitcoin dealer? Let us know in the comments section below.
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