A Houston man has been sentenced to 23 years in federal prison for operating a cryptocurrency investment scheme that prosecutors say defrauded nearly 1,000 people.

Singapore Summit: Meet the largest APAC brokers you know (and those you still don't!).

Robert Dunlap, 55, was convicted last year by a federal jury in the Northern District of Illinois on mail fraud charges, according to reporting by DallasExpress. He ran an investment program called the “Meta-1 Coin Trust.”

Fake Picasso Gold Crypto Scheme Exposed

Between 2018 and 2023, Dunlap told investors that the digital asset was backed by large reserves of gold and high-value artwork. He claimed the backing included up to $1 billion in art and $44 billion in gold. He also said the holdings included works by Pablo Picasso, Salvador Dali, and Vincent Van Gogh.

• After SoFi’s Return, Charles Schwab Enters Retail Crypto Trading with Phased Rollout
• European Traders Get MiFID-Regulated Crypto Leverage as OKX Launches X-Perps
• Retail Traders See Goldman Sachs Enter Bitcoin Yield ETF Race with Options-Based Filing

Prosecutors said these claims were false. They said Dunlap also told investors that an accounting firm had audited the gold holdings. Authorities said he created fake legal documents to support the claims and to conceal that he did not own the assets. The scheme caused losses of more than $20 million. Many investors lost their savings.

IRS Calls Case Beyond Financial Loss

U.S. District Judge LaShonda A. Hunt ordered Dunlap to pay restitution along with the prison sentence.

In a sentencing memorandum, Assistant U.S. Attorneys Jared Hasten and Paige Nutini said Dunlap misled investors over several years. They wrote that “Defendant lied to investors for years, telling them that he had created a safe investment for them,”. They also wrote that “Over the years, defendant was unrepentant, and his lies became bigger.”

They added that future offenders should expect “a serious repercussion that includes loss of one’s liberty for an extended period of time.”

IRS Criminal Investigation Special Agent in Charge Adam Jobes said the fraud extended beyond financial losses. No further details of his statement were included in the release.