Crypto scammers face prison after fake AI trading bots and “deals with Panama” schemes

Two new cases have shed more light on how crypto scammers operate, reminding us to stay skeptical about crypto-related promises.

First, US attorneys announced that Vincent Anthony Mazzotta Jr., 54, a.k.a. “Vincent Midnight,” “Delta Prime,” and “Director Vinchenzo,” pleaded guilty to money laundering and conspiracy to obstruct justice for his role in a scheme to defraud investors.

According to court documents, Mazzotta and his partners in crime falsely promised short-term, high-yield profits from crypto trading using AI-powered automated trading robots, defrauding victims of more than $13 million.

Moreover, the co-defendants are said to have created a fictitious government entity called the Federal Crypto Reserve (FCR) to solicit thousands of dollars to “investigate” crypto investment firms that had disappeared with the victims’ investments.

"Director Vinchenzo" faces a maximum penalty of ten years in prison on the money laundering count and a maximum penalty of five years in prison on the conspiracy to obstruct justice count.

“I encourage investors to be skeptical when approached by anyone promising novel riches. An ounce of prevention is worth a pound of cure,” US Attorney Bill Essayli said.

Meanwhile, in a separate US case, another crypto scammer, Rowland Marcus Andrade, was sentenced to seven years in prison for wire fraud and money laundering.

The attorneys said that Andrade created a crypto asset called AML bitcoin, defrauding investors of around $10 million. For example, among other misrepresentations, Andrade lied that the Panama Canal Authority was close to permitting AML bitcoin to be used for ships passing through the Panama Canal.

According to court documents, Andrade spent more than $2 million of the stolen money on personal expenses, including the purchase of two properties in Texas and two luxury automobiles. The criminal used the traditional financial system to launder the funds via a series of bank accounts.

“Rowland Marcus Andrade promised innovation but delivered deception,” FBI Special Agent in Charge Sanjay Virman was quoted as saying.