Bitcoin Ponzi Scheme Perpetrator Fined $40 Million

Bitcoin Ponzi Scheme Perpetrator Fined $40 Million

A Texas man charged with defrauding consumers through an illicit investment vehicle has been ordered to pay more than $40m in fines by a federal judge. The Thursday ruling brought to close a case launched last July that drew headlines at a time when many in the mainstream US media were only first learning about bitcoin and its related technology. Trendon Shavers, the founder and operator of Bitcoin Savings and Trust (BTCST) had reportedly accrued more than 700,000 BTC in customer funds, worth roughly $64m at the time of his arrest. US Magistrate Judge Amos Mazzant wrote: "The uncontested....


Related News

Man Who Ran Bitcoin Ponzi Scheme Fined $40M

Trendon Shavers, the man who the Securities and Exchange Commission (SEC) said was running a bitcoin Ponzi scheme, has been ordered to pay a $40 million dollar fine by U. S. Magistrate Judge Amos L. Mazzant for his founding of the "Bitcoin Savings and Trust (BTCST)" organization, which was nothing more than a scam for its users. From a complaint filed by the SEC last year (as noted by Inside Bitcoins): From at least September 2011 to September 2012, Shavers, operating under the Internet name "pirateat40," offered and sold BTCST investments over the Internet, raising more than 700,000 BTC....

Bitcoin Ponzi Scheme Collapse Looms in Vietnam

This particular Ponzi Scheme in Vietnam will give Bitcoin a bad reputation in the country. Cryptocurrency is not regulated by the banks, and the local government is not too keen on Bitcoin either. Ever since the inception of Bitcoin, there have been individuals and companies trying to discredit cryptocurrency. Some of them even go as far as setting up deliberate Ponzi Schemes to defraud Bitcoin investors. Such a scheme seems to be on the brink of collapse in Vietnam. Hundreds of people have been burned by this pyramid scheme, which seemed to rely on an MLM structure. It is not the first....

Bitcoin Ponzi Scheme Operator Pleads Guilty to Securities Fraud

Bitcoin Ponzi scheme perpetrator Trendon Shavers has plead guilty to securities fraud, a decision that reverses plea of not guilty submitted in March. Shavers faced up to 20 years in prison for defrauding investors out of an estimated $4.5m while operating Bitcoin Savings & Trust (BS&T). The investment scheme, which promised investors 7% returns on bitcoin market arbitrage activity in 2011 and 2012, became the object of a US Securities and Exchange Commission (SEC) inquiry in July 2013. According to a report by Bloomberg, Shavers will now serve anywhere from 33 months to 41 months in....

Man Jailed for Role in $25 Million Ponzi Scheme Involving a Failed Crypto

A South Florida federal district judge has sentenced Jose Angel Aman to 84 months in prison for his role in perpetrating a $25 million diamond Ponzi scheme. In addition, the judge ordered Aman to pay over $23 million in restitution to victims who invested in his diamond cutting business and the purported diamond-backed crypto token. Fraudulent Claims and Promises In a statement, the U.S. Department of Justice (DOJ) says Aman and his unnamed partners successfully recruited hundreds of people after convincing them “to invest in diamond contracts.” The statement adds that the....

World Bank: Bitcoin Is Not A "Ponzi Scheme"

Ponzi scheme: A fraudulent investment operation where the operator, an individual or organization, pays returns to its investors from new capital paid to the operators by new investors, rather than from profit earned by the operator. Many of the under-informed, the under-educated, and the under-control masses have lobbed this parting shot at Bitcoin over the years. People tend to fear things that they don't understand, and will hide behind that fear with blind attacks that sound right, but are just as ignorant, if not more so. Bitcoin clearly does not fall into the definition of a "Ponzi....