U.S. Prosecutors Unveil Charges Against Nine Individuals in $8.4M Crypto Ponzi Scheme

United States prosecutors have laid charges in two separate cases against nine individuals who allegedly founded or promoted two cryptocurrency companies, IcomTech and Forcount, accused of running Ponzi schemes that defrauded investors out of $8.4 million.

The Allegations Against IcomTech and Forcount

On December 14, the U.S. Attorney’s Office for the Southern District of New York unsealed indictments detailing how IcomTech and Forcount promised investors “guaranteed daily returns” capable of doubling their investments within six months. Prosecutors claim that the companies used funds from later investors to pay earlier investors while redirecting other funds to promote the companies and purchase luxury items and real estate.

The alleged scams reportedly featured lavish expos held in the U.S. and abroad, targeting unwitting investors by showcasing presentations in small communities that promised financial freedom and wealth. Promoters would arrive at these events in expensive vehicles, adorned in luxury attire, and boast about the financial successes they achieved through the firms.

The Fallout

The schemes began to falter when investors were unable to withdraw their purported returns. According to the Securities and Exchange Commission (SEC), Forcount was specifically noted for targeting primarily Spanish-speaking individuals and raised over $8.4 million from “hundreds” of investors by offering memberships that gave a share of the alleged crypto trading and mining activities.

To generate liquidity, the companies created their own tokens, with IcomTech launching “Icoms” and Forcount introducing “Mindexcoin.” However, by 2021, both companies ceased payments to investors, indicating severe issues within their business models.

The Legal Ramifications

U.S. Attorney Damian Williams asserted that these indictments send a clear message to cryptocurrency fraudsters: “We are coming for you. Stealing is stealing, even when dressed up in the jargon of cryptocurrency.”

Among those named in the indictment is David Carmona from Queens, New York, the founder of IcomTech, who faces conspiracy to commit wire fraud charges that carry a maximum penalty of 20 years in prison.

Forcount’s founder, Francisley da Silva from Curitiba, Brazil, faces multiple charges, including wire fraud, wire fraud conspiracy, and money laundering conspiracy, with a potential maximum sentence of 60 years in prison if convicted on all counts.

Common Themes in Cryptocurrency Fraud

The indictments highlight ongoing challenges faced by investors in the cryptocurrency space, as scams and fraudulent practices continue to emerge. The allure of rapid financial gain often leads individuals to overlook potential red flags associated with dubious investment schemes, such as extravagant lifestyle claims and guaranteed returns.

As the cryptocurrency industry continues to mature, regulators are focused on enhanced scrutiny and enforcement efforts to safeguard investors and maintain market integrity.