Crypto Pyramid Scam: DOJ Charges Mining Capital Coin CEO In $62M Fraud Scheme
The US Department of Justice charged Mining Capital Coin’s senior executive officer with conspiracy to commit a $62 million crypto investment scam.
According to the DOJ complaint, Luiz Capuci and unnamed co-conspirators deceived investors over the profit-generating potential of MCC mining packages and a native token called Capital Coin, which was backed by the “largest cryptocurrency mining operation.”
A complaint filed with the US Securities and Exchange Commission last month disclosed that Capuci has sold mining packages to at least 65,000 investors since January 2018.
The group offered daily returns of 1% for up to a year, a SEC press release said.
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The Same Old Lies
The DOJ argues that instead of using investors’ monies to mine cryptocurrencies, as Capuci had promised, he moved the funds to his own cryptocurrency wallets.
The SEC complaint stated that MCC earned more than $8 million from the sale of mining packages and $3.2 million in initiation fees, which financed an expensive lifestyle that included luxury cars, a yacht, and real estate.
On Luxury Cars & Yachts
MCC possessed all the characteristics of a pyramid scheme. To attract investors, Capuci, 44, of Port St. Lucie, Florida, sought affiliates and promoters. In exchange, he promised the promoters extravagant presents such as Apple watches, iPads, and luxury vehicles.
In a press release, Assistant Attorney General Kenneth A. Polite, Jr. of the Justice Department’s Criminal Division stated:
“The department is committed to following the money — whether real or digital — to expose criminal schemes, hold these fraudsters accountable, and protect investors.”
Crypto total market cap at $1.52 trillion on the daily chart | Source: TradingView.com
‘Advanced Crypto Trading Bots’ To Dupe Investors
MCC, Capuci said, partnered with premier software experts in Asia, Russia, and the United States to “build an improved version of Trading Bots that was tested with never-before-used technology.”
On the same day that the DOJ indictment was revealed, the SEC presented fraud charges against MCC, co-founder Emerson Pires, Capuci, and two entities owned by Capuci, Bitchain Exchanges and CPTLCoin Corp.
The DOJ ccused Capuci with wire fraud conspiracy, securities fraud conspiracy, and international money laundering conspiracy.
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45 Years Behind Bars
If convicted on all counts, he could face up to 45 years in prison. The Federal Bureau of Investigation’s Miami Field Office and Homeland Security Investigations are currently investigating the situation.
In recent years, a number of crypto leaders have been charged by authorities of operating Ponzi schemes.
The DOJ indicted Bitconnect creator Satishkumar Kurjibhai Kumbhani earlier this year for allegedly operating a $2 billion Ponzi scheme – the largest crypto pyramid scam in history.
Featured image Bitcoin Magazine, chart from TradingView.com