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Sunday, January 23, 2022

Coin Indicators: Promoter of $ 5 million Ponzi plan faces 10-yr jail sentence

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More than two years after the incident, the Coin Signals case is about to come to an end with the judgment of the main accused Jeremy Spence. The 25-year-old New Yorker was behind a $ 5 million cryptocurrency Ponzi scheme. He now faces a maximum sentence of 10 years in prison for admitting his role in the fraud. Back to the facts.

A fake investment plan with 150% monthly return
Between November 2017 and April 2019, Jeremy Spence managed to convince several investors to join his cryptocurrency funds. In particular, he offered his clients monthly returns of nearly 150% on their respective contributions. Despite numerous losses, Mr. Spence claimed false performance to entice clients to increase their stakes. These were basically done in the form of transferring bitcoin and ether into three funds that made up Coin Signals. Its largest and most active fund was the Coin Signals Bitmex Fund, known to unsuspecting investors as the CS Mex Fund.

He thus managed to divert $ 2 million in cryptocurrency to pay profits to investors, thus developing a Ponzi scheme. From his home in Rhode Island, Mr. Spence spent 17 months peddling fraudulent investment plans to clients. In particular, he used falsified assets under management to back up his claims of sky-high profits. Unable to contain the bubble around Coin Signals any longer, Mr. Spence will eventually end the payments without providing an explanation to investors.

US authorities alert investors
An FBI and Commodities Fraud Task Force investigation ultimately led to Mr. Spence’s arrest earlier this year. He was subsequently indicted on counts of commodity fraud and wire fraud. The United States Department of Justice (DoJ) said in a statement Tuesday that Mr. Spence has chosen to plead guilty, risking a maximum sentence of 10 years in prison.

Prosecutor Damian Willams took advantage of the DoJ’s press release to alert investors to the proliferation of cryptocurrency fraud. “The burgeoning cryptocurrency market can be attractive to investors, however, investors should be aware of the inherent risks, including the risk of fraud,” he said.

Cryptocurrency frauds continue to claim multiple lives around the world as evidenced by the dismantling of a Ponzi scheme involving more than 100,000 people in China. In particular, the operation enabled local authorities to seize approximately 1 billion yuan in funds stolen from investors.

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