US Authorities Sentence Crypto Trader to 42 Months in Prison

Thursday, 12/05/2022 | 06:49 GMT by Bilal Jafar
  • Jeremy Spence defrauded more than 170 investors.
  • The Securities and Commodities fraud unit is handling the case.
cryptocurrencies United States

Illegal crypto activities are on the rise in the US. With that, financial regulatory and law enforcement authorities have increased their efforts to counter the surging trend. Yesterday, Damian Williams, the United States Attorney for the Southern District of New York, confirmed that a man named Jeremy Spence has been sentenced to 42 months in prison for running fraudulent crypto schemes.

Through various illegal crypto investment offerings between November 2017 and April 2019, Spence defrauded over 170 investors. Some of the funds Spence operated during the mentioned period were Coin Signals Bitmex Fund and Coin Signals Alternative Fund. In total, the crypto trader solicited over $5 million through various illegal offerings.

“Spence solicited more than $5 million through false representations, including that Spence’s crypto trading had been extremely profitable when, in fact, Spence’s trading had been consistently unprofitable. For example, on January 28, 2018, Spence posted a message in an online chat group falsely claiming that his trading of investor funds over the past month had generated a return of more than 148%. As a result of this misrepresentation, investors transferred additional funds to Spence. In fact, over that same period of approximately one month, Spence’s trading resulted in net losses in the accounts in which he traded investor funds,” the US Department of Justice said.

Crypto Fraud

Due to the rising popularity of digital assets across the US, fraudulent actors have found different ways to lure investors through Ponzi schemes offering high returns.

The US authorities have warned investors against rising crypto frauds and urged them to conduct extensive research about the cryptocurrency schemes before investments.

“In total, Spence distributed cryptocurrency worth approximately $2 million to investors substantially from funds previously deposited by other investors. In addition to his prison term, Spence, 25, of Bristol, Rhode Island, was sentenced to three years of supervised release and restitution in the amount of $2,847,743.00,” the authority highlighted.

Illegal crypto activities are on the rise in the US. With that, financial regulatory and law enforcement authorities have increased their efforts to counter the surging trend. Yesterday, Damian Williams, the United States Attorney for the Southern District of New York, confirmed that a man named Jeremy Spence has been sentenced to 42 months in prison for running fraudulent crypto schemes.

Through various illegal crypto investment offerings between November 2017 and April 2019, Spence defrauded over 170 investors. Some of the funds Spence operated during the mentioned period were Coin Signals Bitmex Fund and Coin Signals Alternative Fund. In total, the crypto trader solicited over $5 million through various illegal offerings.

“Spence solicited more than $5 million through false representations, including that Spence’s crypto trading had been extremely profitable when, in fact, Spence’s trading had been consistently unprofitable. For example, on January 28, 2018, Spence posted a message in an online chat group falsely claiming that his trading of investor funds over the past month had generated a return of more than 148%. As a result of this misrepresentation, investors transferred additional funds to Spence. In fact, over that same period of approximately one month, Spence’s trading resulted in net losses in the accounts in which he traded investor funds,” the US Department of Justice said.

Crypto Fraud

Due to the rising popularity of digital assets across the US, fraudulent actors have found different ways to lure investors through Ponzi schemes offering high returns.

The US authorities have warned investors against rising crypto frauds and urged them to conduct extensive research about the cryptocurrency schemes before investments.

“In total, Spence distributed cryptocurrency worth approximately $2 million to investors substantially from funds previously deposited by other investors. In addition to his prison term, Spence, 25, of Bristol, Rhode Island, was sentenced to three years of supervised release and restitution in the amount of $2,847,743.00,” the authority highlighted.

About the Author: Bilal Jafar
Bilal Jafar
  • 2440 Articles
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About the Author: Bilal Jafar
Bilal Jafar holds an MBA in Finance. In a professional career of more than 8 years, Jafar covered the evolution of FX, Cryptocurrencies, and Fintech. He started his career as a financial markets analyst and worked in different positions in the global media sector. Jafar writes about diverse topics within FX, Crypto, and the financial technology market.
  • 2440 Articles
  • 73 Followers

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