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Former JPMorgan Executive Accused of Conducting Crypto Fraud

UTC by Bhushan Akolkar · 2 min read
Former JPMorgan Executive Accused of Conducting Crypto Fraud
Photo: Depositphotos

As per the Department of Justice, the executive took investors money saying that he would invest in high-yielding altcoins but actually used the money for his personal benefits.

On Tuesday, April 11, the US Justice Department announced that a former investment banker who served at JPMorgan and the Deutsche Bank will face up to 20 years of jail term for allegedly committing crypto fraud.

The DOJ arrested Rashawn Russell, 27, the registered broker, and shall be arraigned soon in the New York Court. As per the charges, Russell conned a number of investors while making them believe that their money would generate big returns with altcoins, digital assets, and cryptocurrencies apart from Bitcoin.

The Justice Department alleges that when the customers handed over their money, Russell typically used it for his personal gains for gambling and to pay back to other investors. Besides, Russell repeatedly fabricated the documents by falsely showing investors about his ability to generate profits. He altered an image of a bank balance displaying on a bank website that he holds substantial liquidity.

When an investor sought to recoup their investment, Russel never sent the real money. Instead, he sent a fabricated wire transfer confirmation that purported to show the return of investors’ money. United States Attorney Peace said:

“As alleged, Russell turned the demand for cryptocurrency investments into a scheme to defraud numerous investors in order to fund his lifestyle. This Office will continue to aggressively pursue fraudsters perpetrating these schemes against investors in the digital asset markets.”

The US Attorney’s Office, Eastern District of New York indictment reads:

“At times, he also claimed he had developed a successful strategy to trade ‘altcoin’ cryptocurrencies and that he had earned returns for investors in excess of 100% over previous three-month periods”.

Rise in Crypto Frauds

During the crypto winter of 2022, there was a major surge in crypto frauds with multiple such instances recorded across the globe. During the last year, a majority of the crypto frauds were quite prominent in the decentralized finance (DeFi) market which lost more than $4 billion of investors’ funds.

The US Department of Justice (DoJ) and other regulators have been vigilant since then over the developments in the crypto space.

“The charge in the indictment is an allegation and Russell is presumed innocent until proven guilty beyond a reasonable doubt.  If convicted, he faces a maximum of 20 years in prison,” added the DoJ.

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