Indictments over alleged ‘cryptomining’ Ponzis grossing $8.4 million

US prosecutors have filed charges in two separate cases against nine people who founded or promoted a pair of cryptocurrency companies believed to be Ponzi schemes that raked in $8.4 million from investors.

The U.S. Attorney’s Office for the Southern District of New York unveiled the allegation on Dec. 14, alleging that alleged cryptocurrency mining and trading firms IcomTech and Forcount had promised investors “guaranteed daily returns” that they could double their investment in six months.

In reality, prosecutors say both companies were using money from later investors to pay off previous investors, while other funds were spent promoting the companies and buying luxury goods and real estate.

“Lavish expos” were held in the United States and abroad, along with presentations in small communities, which enticed investors with promises of financial freedom and wealth.

Promoters would show up to events in expensive cars, wear luxury suits, and brag about the money they were making by investing in the company they were promoting. Investors were given access to a “portal” to track their returns

IcomTech and Forcount began to collapse when users were unable to collect their alleged returns.

Charges brought against Forcount’s creators and promoters by the Securities and Exchange Commission (SEC) say the organization primarily targeted Spanish-speakers and raised more than $8.4 million from “hundreds” of investors selling “subscriptions offering a portion of its cryptocurrency trading and mining business.

In an effort to boost liquidity, both companies have created tokens so they can try to repay investors with IcomTech and Forcount by launching ‘Icoms’ and ‘Mindexcoin’ respectively.

The token sales apparently failed as by 2021 both had stopped making payments to investors.

“With these two allegations, this bureau is sending a message to all cryptocurrency scammers: We’re coming for you,” said U.S. Attorney Damian Williams. “To steal is to steal, even when dressed in cryptocurrency jargon.”

Related:Cryptocurrency has become a playground for scammers

David Carmona of Queens, New York was named in the indictment as the founder of IcomTech and was charged with conspiracy to commit wire fraud which carries a maximum penalty of 20 years in prison.

The founder of Forcount was named Francisley da Silva, from Curitiba, Brazil and is charged with wire fraud, wire fraud conspiracy and money laundering conspiracy which carries a maximum of 60 years in prison if convicted of all charges.

The business promoters face various charges related to wire fraud, wire fraud and conspiracy to commit money laundering and misrepresentation.