Ex-CEO of PayCoin Sentenced to Prison for Fraud and Fined $9 Million

https://theoofy.com/14862/ex-ceo-of-paycoin-sentenced-to-prison-for-fraud-and-fined-9-million/

Josh Garza, the ex-CEO of PayCoin, has been locked behind bars and fined $9 million in connection with his firm’s role in a big Ponzi scheme, which saw many investors lose their investments. The judgment has been made at a time when the U.S authorities and SEC tighten their effort on crypto-related fraud.

The sentence that was made by a District Court Judge will be accompanied by a half a year house arrest.

The fraud was carried out between May 2014 and January 2015by four establishments managed by Garza. These establishments auctioned the rights and access to crypto mining activities and permitted investors to own a section of these activities via “PayCoin” and “Haslets” that alleged to offer investors the privileges to a section of the gains from the mining activities.

John Durham, the US District Attorney for Connecticut said that “haslet customers, or investors, were buying the rights to profit from a slice of the computing power owned by the companies.”

Though the undertakings literally appear legitimate, Garza made numerous allegations that ought to have raised red flags for stakeholders, comprising the warrant that the value of the cryptocurrency would not decline below $20 per unit since the firm would prop the value using their $100 million cryptocurrency reserve.