Former IcomTech executive Marco Ruiz Ochoa pleaded guilty on Wednesday over his role in what prosecutors called a crypto Ponzi scheme.
IcomTech, an alleged crypto mining and trading company, promised investors profits in exchange for their purchase of "purported cryptocurrency-related investment products." Ochoa, 35, along with others promised profits from the companies’ crypto trading and mining arm that they said would result in daily returns.
IcomTech’s crypto trading and mining business did not exist, prosecutors said, and investor money was used for other schemes and personal expenditures.
"Today’s guilty plea sends a clear message that we are coming after all of those who seek to exploit cryptocurrency to commit fraud," Damian Williams, U.S. Attorney for the Southern District of New York, said in a statement.
Promoters for IcomTech showed up to events in expensive cars and wearing luxury clothes in a move to appear successful, prosecutors said.
"The atmosphere of these events was festive and designed to generate excitement about the schemes," they said.
When investors began trying to withdraw money in 2018, they were then met with excuses, delays and hidden fees.
"Despite these complaints, IcomTech promoters, including Ochoa, continued to promote IcomTech and accept victims’ investments," prosecutors said. By the end of 2019, IcomTech collapsed.
Ochoa pled guilty on Wednesday to one count of conspiracy to commit wire fraud, which carries a maximum sentence of 20 years in prison.
The Commodity Futures Trading Commission also brought charges against Ochoa, and other IcomTech executives including David Carmona, Juan Arellano Parra and Moses Valdez in May. The CFTC said the group targeted Spanish-speaking communities.
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