Pablo Renato Rodriguez, co-founder of the infamous crypto-based pyramid scheme AirBit Club, was recently handed down a hefty 12-year prison sentence by US District Judge George B. Daniels.
Rodriguez, along with his co-partners, including Gutemberg Dos Santos, had masterminded the AirBit Club scheme, promising trusting investors guaranteed profits through cryptocurrency mining and trading.
The schemers had cleverly dressed up the scam as a multilevel marketing (MLM) club, falsely promising revenue generation through encrypted activities. Unfortunately, their operation had nothing to do with crypto mining or trading but was merely an excuse to line their own pockets.
Investors succumbed to the tantalizing allure of daily returns offered for their cash investment in purchasing club “memberships”. However, the club’s founders, promoters, and accomplices were not actually conducting any legitimate financial activities, instead lavishly funding their own extravagant lifestyles worldwide.
Adding insult to injury, any victims who dared to demand their hard-earned money back were met with ignorance, delays, hidden fees, and a series of creative lies.
Attempting to wash their hands clean, the offenders undertook subterfuge measures to hid their gains, including money laundering through bank accounts and an attorney trust account, managed by Scott Hughes, a licensed lawyer in California.
Unsurprisingly, this was not the schemers’ first fraudulent rodeo. Both Rodriguez and Dos Santos have previously gotten into hot water with the Securities and Exchange Commission (SEC) over a similar pyramid investment scheme known as Vizinova, leading to a loss of $1.7 million in disgorgement and fines. Regrettably, their licensed attorney, Hughes, played a detrimental role in erasing their pre-existing culpable records on the web. This paved the way for the duo to once more cheat unsuspecting individuals.
Currently, Dos Santos, Hughes, and other key players in the scheme like Cecilia Millan and Karina Chairez have pled guilty to charges including wire fraud and money laundering conspiracy, among others, and are awaiting their respective sentences. Meanwhile, Rodriguez has been ordered to forfeit a staggering $100 million, including real estate properties, US dollars, and assets including Bitcoin.
According to US Attorney, Damian Williams, Rodriguez’s sentence should serve as a stern warning against committing crypto-related fraud and exploiting investors. Yet, one might wonder, given the increasing popularity of cryptocurrencies and the potential for high returns, are enough measures in place to protect investors or will we see an upsurge in such scams?
Source: Cryptonews
