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SBF was almost extorted for ‘protection’ in Brooklyn jail, recalls ex-inmate

December 1, 2023 Coin Telegraph

Brooklyn

Gene Borrello, a former prisoner at the Metropolitan Detention Center told crypto blogger Tiffany Fong that Sam Bankman-Fried was targeted for his timid nature and having “the body of the 80-year-old.”

Sam Bankman-Fried was reportedly worried for his safety during his pre-trial detention time at the Brooklyn Metropolitan Detention Center and even considered paying another inmate for “protection,” according to a former inmate.

New York mob enforcer-turned-informant Gene Borrello told crypto blogger Tiffany Fong in a Nov. 30 interview that spent time with Bankman-Fried in the lead-up to his criminal trial.

I got a chance to interview Gene Borrello, a former mob enforcer who was in jail with Sam Bankman-Fried. pic.twitter.com/nszTXVUrSQ
— Tiffany Fong (@TiffanyFong_) November 30, 2023

Borrello said during his time there, other prisoners saw the former crypto mogul as timid, having “the body of the 80-year-old,” and was presumed to have access to money.

“He has the body of the 80-year-old. He has, like, no shape to him, you know what I mean?”

A prisoner attempted to make Bankman-Fried fearful to extort him for protection money.

AirBit Club ‘ponzi’ co-founder gets 12 years prison

September 27, 2023 Coin Telegraph

Cecilia Millan

Convicted fraudster Pablo Renato Rodriguez will also need to serve three years of supervised release after he finishes his 12 year imprisonment sentence.

The co-founder of AirBit Club — a cryptocurrency pyramid scheme that swindled investors of over $100 million — has been sentenced to 12 years in prison for his role in a $100 million "pyramid scheme" that purported to be involved in crypto mining.

The sentencing comes nearly seven months after Rodriguez — the co-founder of AirBit Club — pleaded guilty to wire fraud conspiracy charges in a United States District Court in March.

In a Sept. 26 statement, Damian Williams, United States Attorney for the Southern District of New York said Rodriguez “preyed” on unsophisticated investors with false promises that their funds were invested into legitimate cryptocurrency trading and mining operations.

“Instead of investing on behalf of investors, Rodriguez hid victims’ money in a complex laundering scheme using Bitcoin, an attorney trust account, and international front and shell companies and used victims’ money to line his own pockets.”

District Court Judge George B. Daniels imposed an additional three years of supervised release for Rodriguez, which will follow his 12-year prison sentence.

.@HSINewYork's El Dorado Task Force, the largest anti-money laundering task force in the US, is proud to have played a vital role in delivering justice to the victims of Pablo Renato Rodriguez and the fraudulent "AirBit Club” Ponzi Scheme #HomelandSecurityInvestigations #HSINY https://t.co/UVco4ai3rI
— HSI New York (@HSINewYork) September 26, 2023

The convicted fraudster was ordered to pay a forfeiture of $65 million and to forfeit other items, including a total of 3,800 Bitcoins (BTC) (worth $100 million), Rodriguez’s Irvine residence in California, $900,000 in U.S. dollars seized from the property and nearly $1 million previously held in escrow for a Gulfstream Jet.

The other defendants — Dos Santos, Scott Hughes, Cecilia Millan and Karina Chairez have also pleaded guilty and are awaiting sentencing verdicts.

AirBit Club was launched in 2015. Prospective investors were told that AirBit Club earned returns on cryptocurrency mining and trading and that victims would earn passive, guaranteed daily returns on any membership purchased.

However, as early as 2016, club members wishing to withdraw proceeds were met with excuses, delays and hidden fees and told they must recruit new members if they wanted to receive the returns.

The operators of the club, including Rodriguez were charged with fraud and money laundering by the DOJ in August 2020 after a probe by the United States Homeland Security Investigations.

In 2022, $7.6 billion in funds were lost to cryptocurrency ponzi and pyramid schemes, according to a June 28 report by blockchain intelligence firm TRM Labs.

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Former OpenSea manager withdraws application for bail pending appeal

September 7, 2023 Coin Telegraph

Coin Telegraph

The attorneys representing Nathaniel Chastain informed the court that Chastain will self-surrender on Nov. 2 to begin serving his sentence.

A former manager at nonfungible token marketplace OpenSea sentenced to three months in prison for insider trading has opted to serve the sentence while his appeal is pending.

On Sept. 6, Nathaniel Chastain’s lawyers filed a letter with a New York District Court informing the judge that Chastain decided to withdraw his application for bail pending appeal.

As a result, per the court's previous order and judgment, Chastain will self-surrender by Nov. 2 to begin serving his sentence while his appeal is pending.

*Screenshot of the letter from Chastain’s lawyers. Source: CourtListener*

Chastain, a former OpenSea product manager, was convicted on May 3 on counts of wire fraud and money laundering and on Aug. 22 was sentenced to three months in prison for offenses relating to insider trading on the NFT platform.

He was also ordered to pay a $50,000 fine and forfeit any ill-gotten crypto he made from trading on OpenSea.

Chastain had control over which NFTs and collections would be featured on OpenSea’s homepage — greatly increasing their visibility and possibly impacting their price.

He’s alleged to have purchased 45 NFTs prior to featuring them on the homepage and then reselling them for a profit once their prices had increased.

Prosecuting attorney Allison Nichols argued at the time that Chastain knew he was breaking the law by using anonymous OpenSea accounts to make the trades.

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Ex-CFO who stole $5M to trade crypto and ‘meme stocks’ gets 3 years in prison

April 28, 2023 Coin Telegraph

Ex-CFO who stole M to trade crypto and ‘meme stocks’ gets 3 years in prison

Coin Telegraph

Cooper Morgenthau embezzled $5 million from three different companies and lost almost all of it trading cryptocurrencies and “meme stocks.“

The former chief financial officer of a special purpose acquisition company (SPAC) was sentenced to three years in prison after embezzling $5 million, which he used to trade cryptocurrencies and “meme stocks.“

An April 27 press release from the United States Department of Justice said Cooper Morgenthau, the former chief financial officer of African Gold Acquisition Corporation (AGAC), embezzled more than $5 million from three different SPACs: AGAC, Strategic Metals Acquisition Corporation I (SMAC I) and Strategic Metals Acquisition Corporation II between June 2021 and August 2022.

Former chief financial officer of two SPACs sentenced to 36 months in prison for fraud schemehttps://t.co/ZOvi2ksEi1
— US Attorney SDNY (@SDNYnews) April 27, 2023

According to a related civil complaint from the U.S. Securities and Exchange Commission (SEC), Morgenthau wired approximately $1.2 million in funds from African Gold to his personal accounts, using the money to trade equities and options of cryptocurrencies and so-called meme stocks .

In doing so, he lost almost all of the funds.

Following the losses, he then provided falsified documents to accountants and an auditor at African Gold ahead of its public filing with the SEC, which led to “material misstatements” in the company’s public financial records.

Meanwhile, Morgenthau raised another $4.7 million from private investors in a SPAC separate from African Gold, based on the fraudulent claim that the money would be used to launch yet another SPAC.

Unfortunately for the investors, Morgenthau used the freshly-raised capital to cover his losses at African Gold and continue further trading of cryptocurrencies and meme stocks.

At the time, SMAC I was in the process of raising money from private investors ahead of its initial public offering.

African Gold discovered the withdrawals in August 2022, fired Morgenthau, and informed the SEC of his malpractice.

Morgenthau, a resident of Florida , pled guilty to one count of wire fraud on Jan. 3. In addition to his three-year prison sentence, he was also ordered to forfeit $5.1 million and pay further restitution of $5.1 million.

“With today’s sentencing of Cooper Morgenthau, SPAC promoters have been sent a message that fraud in the SPAC markets will be punished, and greed on Wall Street will be met with serious consequences,” U.S. Attorney Damian Williams said in the statement.

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Silk Road Hacker Sentenced to a Year in Prison for Wire Fraud

April 16, 2023 Bitcoin.com

prison

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