Five executives and a lawyer, allegedly involved in a crypto "Ponzi scheme" that allowed them to rake in approximately $100 million in just a span of five years have pled guilty to several money laundering and fraud charges, which each carries a maximum sentence of decades of imprisonment.

Pablo Renato Rodriguez, one of the founders of Airbit Club, the so-called cryptocurrency mining and trading platform, is the latest to plead guilty to wire fraud conspiracy charges Wednesday, according to the Department of Justice (DOJ).

Airbit Club was a fake crypto mining and trading platform company that started its operations from 2015 to 2020.

According to the DOJ, promoters and executives of the company lured unsuspecting investors into believing that they would earn a passive income and rake in profits on any membership offering they purchased.

The government agency further revealed that while investors could see profits flowing in on their Airbit Club online account, no actual trading or mining ever occurred.

Prosecutors claimed that investors' funds were instead spent on enriching the club's executives and promoters, who spent the funds on purchasing cars, jewelry and luxury homes and "more extravagant expos to recruit more victims."

The executives and promoters also traveled to various regions, including the United States, Latin America, Asia and Eastern Europe, to promote the company in "lavish expos" and entice investors to purchase the membership packages it was offering, according to U.S. prosecutors.

Aside from Rodriguez, Airbit Club co-founder Gutemberg Dos Santos also pleaded guilty in October 2021 after he was extradited from Panama to the United States in 2020.

Promoters Jackie Aguilar, Cecilia Millan and Karina Chairez also pleaded guilty to the charges in early 2023 while Scott Hughes, the lawyer who allegedly helped Rodriguez and Dos Santos launder money, also pleaded guilty earlier this month.

Prosecutors also disclosed that as early as 2016, investors who tried to withdraw their funds from Airbit Club were met with excuses, delays and ridiculous hidden fees amounting to over 50% of the requested amount the investors wanted to withdraw.

"The defendants took advantage of the growing hype around cryptocurrency to con unsuspecting victims around the world out of millions of dollars with false promises that their money was being invested in cryptocurrency trading and mining," Damian Williams, United States Attorney for the Southern District of New York, said.

"Instead of doing any cryptocurrency trading or mining on behalf of investors, the defendants built a Ponzi scheme and took the victims' money to line their own pockets," the prosecutor added.

The crest of the United States Department of Justice (DOJ) is seen at their headquarters in Washington, D.C.
Reuters
Read more