coindesk.com
A federal jury has convicted Randall Crater, the founder of My Big Coin, of wire fraud and money laundering for selling fraudulent virtual currency the U.S. Justice Department announced on Thursday.
Crater’s firm offered virtual payment services through a fraudulent digital currency known as “My Big Coins,” which were marketed to investors between 2014 and 2017, according to court documents and trial evidence.
Crater and his associates falsely claimed the coins were a functioning cryptocurrency backed by $300 million in gold, oil and other assets. They also falsely told investors the company had a partnership with MasterCard and that the crypto could be easily exchanged for fiat currency or other virtual currencies.
Over the course of the scheme, Crater misappropriated over $6 million of investor funds for his own purposes, including spending hundreds of thousands of dollar on antiques, artwork and jewelry, according to the Justice Department.
In 2018, the CFTC charged Crater and My Big Coin with commodity fraud and also filed civil charges against the company’s CEO and two of Crater’s associates.
Crater was convicted of four counts of wire fraud, which carries a maximum penalty of up to 20 years in prison for each count, and up to three counts of money laundering, which carries a maximum penalty of up to 10 years for each count.
Crater is scheduled to be sentenced on Oct. 27.