The founder of a defunct, Nevada-based cryptocurrency company, My Big Coin, was convicted of bilking investors out of more than $6 million by marketing and selling a fraudulent virtual currency that he claimed was backed by $300 million in gold and other assets.
Randall Crater, 51, was convicted on Thursday by a federal jury in Boston of wire fraud and unlawful monetary transactions. District Court Judge Denise J. Casper scheduled sentencing for Oct. 27. Crater was arrested and charged in February 2019, after being sued by the US Commodity Futures Trading Commission the previous year.
Crater founded his business in 2013, according to a news release from the US Attorney’s Office, offering payment services through a fraudulent digital currency that he marketed to investors between 2014 and 2017.
Crater falsely claimed to be selling “a fully functioning cryptocurrency backed by $300 million in gold, oil and other valuable assets,” the release said.
He also fraudulently told investors that My Big Coin had a partnership with MasterCard and its digital currency could be exchanged for fiat or other virtual currencies. “Crater promulgated these misrepresentations through social media, the internet, email and text messages.”
Over the course of the scheme, he “misappropriated over $6 million of investor funds for his own personal gain and spending on goods, including hundreds of thousands of dollars’ worth of expenses on antiques, artwork and jewelry,” the release said.
US Attorney Rachael S. Rollins said: “Crater saw the burgeoning popularity of crypto as a chance to get rich quick through an unscrupulous fraud scheme cloaked by flashy marketing tactics and outright lies. In the end, he is just another fraudster who made his way into the booming world of cryptocurrency.”
The case is US v. Crater, US District Court, District of Massachusetts, No. 19-cr-10063. Crater was represented by Scott Lopez of Lawson & Weitzen.
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