A Localbitcoins and Paxful trader pleaded guilty to some bitcoin scams. The U.S. Department of Justice claims the trader knowingly sold Bitcoin to victims of fraudulent schemes.
Bitcoin trader in front of jail
The U.S. Department of Justice (DOJ) announced last week that a Boston man pleaded guilty in federal court for his role in two Bitcoin fraud programs. Austin Nedved “pleaded guilty to supporting and facilitating wire fraud and money laundering conspiracies,” said the DOJ, adding that the 29-year-old is currently “in custody and is serving a sentence on a separate fraud conviction.” The announcement states:
Nedved admitted that he ran a business that bought and sold digital currencies, including bitcoin, for cash. Nedved promoted its services under the name ‘usmc1991’ through Localbitcoins.com and Paxful.com.
The Justice Department described that he “supported and promoted romance and lottery systems for vulnerable victims”. In romance novels, the victims believe they are in love with the scammers and send money on board in the form of Bitcoin. With lottery systems, victims believe that “they can receive lottery winnings or substantial government grants by passing cash to the scammers for administrative fees or costs,” the DOJ described.
At the end of 2017, a fraudster posed as an American oil company owner and managed to make a 78-year-old fall in love with him. Without ever meeting in person, she agreed to marry him. The scammer then told her that his oil company “had an accident overseas that killed people and that he needed money to meet his obligations under the accident with a foreign government.” He convinced her that he couldn’t go back to the US and marry her if she didn’t send him a few bitcoins to pay the severance pay.
The victim, who had never bought bitcoin before, contacted Nedved in June 2018. They met in a parking lot in Maine and she bought $ 100,000 worth of BTC with cash. Nedved then transferred the coins to a wallet that was controlled by the scammer.
The DOJ claimed that when Nedved accepted $ 100,000 from the 78-year-old, he knew she was a victim of romance scams. Even so, he and his co-conspirator took another $ 40,000 from her. According to the DOJ:
Although Nedved knew or was intentionally blind to the fact that his customers were victims of fraud, he sold them Bitcoin so they could send money overseas to the fraudsters.
In total, Nedved and his co-conspirators sold more than $ 630,000 worth of BTC to victims of bitcoin fraud, the DOJ claimed, claiming they knew that “the money represents revenue from romance and lottery scams and other illegal activities” .
The Justice Department stated, “The wire fraud ancillary charges include up to 20 years ‘imprisonment, three years’ custody release, and a fine of up to $ 250,000 or double the gross profit or loss, whichever is greater . “In addition, the money laundering conspiracy charge sees a prison sentence of up to 20 years, a supervised release of three years and a fine of up to $ 500,000 or double the value of the funds involved in the financial transactions prior to the conspiracy. “
What do you think of the charges against this bitcoin trader? Let us know in the comments below.
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Bitcoin Scams, Bitcoin Scams, Bitcoin Scams, Bitcoin Systems, LocalBitcoins, Localbitcoins Sellers, Localbitcoins Traders, Paxful, Paxful Traders, Paxful Traders, Jail Sentences
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