SEC charges Texas man for defrauding investors in bitcoin Ponzi scheme
The US Securities and Exchange Commission (SEC) has charged a Texas man and his company for defrauding investors using a bitcoin Ponzi scheme. According to the SEC, Trendon T. Shavers, founder and operator of Bitcoin Savings and Trust (BTCST), allegedly used the monikers 'Pirate' and 'pirateat40' to offer and sell bitcoin investments on the internet. He managed to raise at least 700,000 BTC, which is now worth more than $64 million. Shavers promised the investors they would receive up to 7% interest per week based on the company's bitcoin market arbitrage activity, however, BTCST was....
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Charles Ponzi. Trendon Shavers, aka "Pirate@40," was arrested this morning on securities fraud and wire fraud charges stemming from his involvement in a Bitcoin-related Ponzi scheme. A Ponzi scheme is a fraudulent investment operation where the operator pays returns to its investors from new capital paid by new investors, rather than from profit earned. The scheme is named after Charles Ponzi, who became notorious for using the technique in 1920. Shavers was the founder and operator of Bitcoin Savings and Trust (BCS&T), which offered and sold Bitcoin-based investments through the Internet.....
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