Another 'blockchain' bust: Crypto founder charged in $1m fraud scheme
US prosecutors have issued another reminder to be careful with crypto investments and not to trust founders blindly, following the latest charges and the arrest of a New York man.
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US prosecutors have issued another reminder to be careful with crypto investments and not to trust founders blindly, following the latest charges and the arrest of a New York man.
The US Attorney's Office for the Southern District of New York said it arrested Jeremy Jordan-Jones and charged him with wire fraud, securities fraud, making false statements to a bank, and aggravated identity theft. If proven guilty, most of the charges against Jordan-Jones carry up to 20–30 years in prison.
However, this time, it doesn’t appear to be a multimillion-dollar fraud scheme, as he is suspected of defrauding investors of “just” over one million dollars through misrepresentations of his purported company, Amalgam Capital Ventures, capabilities, partnerships, and investment intentions.
According to Jay Clayton, the US. Attorney for the Southern District of New York, the accused man capitalized on the publicity around blockchain technology and perpetrated a brazen scheme to defraud investors from at least January 2021 through at least November 2022.
“He touted his company as a groundbreaking blockchain startup, backed by high-profile partnerships. In reality, Jordan-Jones’s company was a sham, and investors’ funds were siphoned off to bankroll his lavish lifestyle,” Clayton said in the announcement.
Amalgam, which has since been shut down, was marketed as a tech startup working on point-of-sale systems and blockchain-based payment and security solutions.
Prosecutors claim that Jordan-Jones lied about functioning software products, high-profile partnerships with major-league sports teams, prominent payment-processing platforms, and the listing of the project's native token on exchanges. Moreover, he allegedly lied about the company’s financial condition and submitted falsified financial documents to a bank.
These charges come on the heels of an announcement by the US Securities and Exchange Commission, which earlier this week accused New York City-based Unicoin, Inc., and three of its top executives of fraud that raised more than $100 million from thousands of crypto investors.
