A federal jury found the founder of My Big Coin guilty of a fraudulent scheme in which $6 million was defrauded from cryptocurrency investors. The defendant made several false claims, including that the coins were backed by gold and that the company was a Mastercard partner.
My Big Coin Founder Convicted
The US Department of Justice (DOJ) announced on Thursday that the founder of My Big Coin Pay Inc. (also known as My Big Coin) Randall Crater was convicted of cryptocurrency fraud. A 51-year-old man from East Hampton, New York, swindled investors out of more than $6 million, according to the Justice Department.
Crater was “convicted of four counts of wire fraud, three counts of illegal money transactions, and one count of running an unlicensed money transfer business,” the Justice Department specified.
Eric Shen, the inspector heading the U.S. Postal Inspection Criminal Investigation Team who worked on the case, commented:
The defendant preyed on victims with what appeared to be an unstoppable rise in the value of the cryptocurrency, when in reality investors were only funding his lavish lifestyle.
The defendant spent the fraudulently obtained funds on “luxury items for himself, including works of art, antiques and jewelry,” the Justice Department said in a statement.
My Big Coin was sold to crypto investors between 2014 and 2017. “Krater and his associates falsely claimed that [the] the coins were a fully functioning cryptocurrency backed by $300 million in gold, oil and other valuable assets.” They also stated that “My Big Coin is partnering with Mastercard and that [the] coins could easily be exchanged for government-backed fiat money or other virtual currencies.” However, the Department of Justice stressed:
In reality, [the] the coins were not backed by gold or other valuable assets, did not have a partnership with Mastercard, and could not be easily transferred.
Additionally, the Commodity Futures Trading Commission (CFTC) filed charges against Crater and My Big Coin in January 2018.
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