- Jeremy Spence, a cryptocurrency trader, has been charged with taking over $5 million from users in a fraudulent scheme
- His arrest was carried out by the U.S. Department of Justice on January 26th
- Spence allegedly promised high returns to investors and scammed them into purchasing digital assets
A cryptocurrency fund manager has been arrested by the U.S. Department of Justice for running a Ponzi scheme which led to losses running in millions of dollars.
Cryptocurrency Scam Results In Big Losses
In a report released by the U.S. Department of Justice (DOJ) on Tuesday, Jeremy Spence has been charged and arrested for a cryptocurrency scam. This case was presented in the federal court of Manhattan. The digital asset fund manager ran a Ponzi scheme which assured high returns to investors. However, the fraudulent plot caused huge losses which exceeded $5 million. The scammer belongs to Rhode Island. He is otherwise known as “Coin Signals.”
The DOJ shared that Spence is a digital money broker who requested assets for different crypto funds that he managed. He simultaneously conducted commodities and wire fraud offences. 170 investors were duped into investing after he made false claims and they collectively lost over $5 million.
Returns Touching 148% Were Promised To Investors
U.S. Lawyer Audrey Strauss clarified that the accused purportedly scammed interested buyers to invest in his digital currency venture by assuring returns of up to 148%. However, investors frequently lost money.
FBI Assistant Director-in-Charge, Sweeney, further elaborated that Spence utilized cash invested by new financial buyers to repay others for the scam to keep moving ahead. This is a direct indication of a Ponzi scheme.
As per the Justice Department, from November 2017 through April 2019, Spence requested individuals to buy several cryptocurrencies through funds created and overlooked by him. Investors would move cryptographic money such as Bitcoin and Ethereum so that Spence could put them into his funds. The biggest and generally dynamic of these were the Coin Signals Bitmex Fund, also known as the CS Mex Fund, as well as the Coin Signals Alternative Fund, otherwise called the CS Alt Fund. Additionally, there was also the Coin Signals Long Term Fund.
Spence is accused of commodities fraud, which translates to a sentence of 10 years in jail, and one count of wire extortion, that will result in a sentence of 20 years in jail. The Commodity Futures Trading Commission (CFTC) has likewise filed a confederate civil enforcement authorization against Spence, accusing him of extortion through carrying out the Ponzi scheme.
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