Thomas John Sfraga, a well-known figure in the cryptocurrency industry, has pleaded guilty to wire fraud after allegedly deceiving more than a dozen victims into investing in non-existent ventures, including fraudulent cryptocurrency schemes.
According to the United States Department of Justice (DOJ), Sfraga convinced a victim to invest in a fictitious cryptocurrency “virtual wallet” and promised returns as high as 60% in three months. However, it appears he was operating a Ponzi scheme, where the returns paid to earlier investors came not from legitimate profits but from the investments of new participants.
Sfraga allegedly converted the funds to his own benefit, using them to pay expenses and earlier investors. Several of the victims were friends and neighbors of Sfraga, whom he betrayed to swindle over $1.3 million of their hard-earned savings.
This case is just one of several recent crackdowns on cryptocurrency fraud. In May, the DOJ charged brothers Anton Peraire-Bueno and James Pepaire-Bueno with conspiracy to commit wire fraud, wire fraud, and conspiracy to commit money laundering, alleging they obtained $25 million in cryptocurrency in approximately 12 seconds using a scheme that undermines the integrity of the blockchain.
In April, the former head of legal and compliance for the multibillion-dollar OneCoin fraud scheme was sentenced to four years in jail after admitting she helped launder millions of dollars.
Takeaway:
- Be cautious when investing in cryptocurrencies and do your research on the project and its team.
- Be wary of promises of unusually high returns and be skeptical of unsolicited investment opportunities.
- Always verify the legitimacy of investment opportunities and be cautious of Ponzi schemes.
By being informed and taking steps to protect yourself, you can minimize the risk of falling victim to cryptocurrency fraud.
BitminerFactory is brought to life by Darrell Houghton, our astute publisher. With a deep-rooted passion for crypto and crypto mining spanning many years, Darrell’s unwavering enthusiasm fuels his daily quest for knowledge. He is eager to share the pivotal news stories of the day while also providing his own analysis and commentary with Bitminer Factory’s readers.
Source: Cointelegraph
