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US Justice Department uncovers $1.89 billion cryptocurrency fraud scheme

31 ianuarie 2024

The Justice Department announced charges against two individuals and the guilty plea of a third individual for orchestrating a $1.89 billion cryptocurrency fraud scheme.

Sam Lee, 35, an Australian citizen residing in Dubai, United Arab Emirates, was charged for allegedly co-founding HyperFund, also known as HyperTech, HyperCapital, HyperVerse, and HyperNation. Rodney Burton, 54, of Miami, and Brenda Chunga, 43, of Severna Park, Maryland, were promotors of HyperFund.

The defendants are charged with defrauding investors to the tune of $1.89 billion. As alleged in court documents, the defendants falsely represented that investors would receive substantial returns paid from cryptocurrency mining operations, which did not in fact exist,” said Acting Assistant Attorney General Nicole M. Argentieri of the Justice Department’s Criminal Division. “With our partners in Homeland Security Investigations and IRS Criminal Investigation, we are committed to uncovering sophisticated frauds involving cryptocurrency and digital assets and bringing those who perpetrate them to justice.”

The level of alleged fraud here is staggering,” said U.S. Attorney Erek L. Barron for the District of Maryland. “Whether it’s cryptocurrency fraud, or any other financial frauds, if it sounds too good to be true, it probably is. This office and our law enforcement partners will hold perpetrators accountable for these and other fraud schemes.”

According to court documents, from June 2020 to November 2022, Lee and his co-conspirators allegedly offered and sold investment contracts to the public through HyperFund’s online investment platform. HyperFund’s promotional materials allegedly made various false claims, including that investors who purchased HyperFund “memberships” would receive between 0.5% to 1% daily in passive rewards until the company either doubled or tripled the investor’s initial investment. To convince investors that HyperFund could make such payments, HyperFund allegedly claimed that its payments would be disbursed in part from its revenues from large-scale crypto mining operations, when in truth, HyperFund did not have such operations. Beginning in at least July 2021, HyperFund allegedly began to block investor withdrawals.

Lee is charged with one count of conspiracy to commit securities fraud and wire fraud. If convicted, he faces a maximum penalty of five years in prison. Burton is charged by criminal complaint with one count of conspiracy to operate an unlicensed money transmitting business and one count of operating an unlicensed money transmitting business. He also faces a maximum penalty of five years in prison on each count. Chunga pleaded guilty today to one count of conspiracy to commit securities fraud and wire fraud. She is scheduled to be sentenced on May 1 and faces a maximum penalty of five years in prison. A federal district court judge will determine any sentence after considering the U.S. Sentencing Guidelines and other statutory factors.

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Anders Olofsson – former Head of Payments Finastra

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So many people are coming here to Bucharest, people that I see and interact on linkedin and now I get the change to meet them in person. It was like being to the Football World Cup but this was the World Cup on linkedin in payments and open banking.”

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In 23 septembrie 2019, BNR a anuntat infiintarea unui Fintech Innovation Hub pentru a sustine inovatia in domeniul serviciilor financiare si de plata. In acest sens, care credeti ca ar trebui sa fie urmatorul pas al bancii centrale?