CEO in Las Vegas faces 127-year sentence for involvement in crypto laundering connected to cartels and fraudulent charity activities.
The Department of Justice has announced that the CEO of a Las Vegas Internet company could potentially face a prison sentence of 127 years. This comes after Martin Mizrahi, aged 53, was convicted of wire fraud, money laundering, and identity theft. Mizrahi’s conviction is part of a broader global crackdown on illegal activities involving cryptocurrencies.
The conviction was the result of a 12-day trial in a federal court in Manhattan. During the trial, it was revealed that Mizrahi used Bitcoin to launder over $4 million, including $3 million from a New York nonprofit organization and funds from a Mexican cartel. Additionally, Mizrahi was involved in a credit card fraud scheme that processed nearly $8 million in fraudulent charges through his company.
Mizrahi’s illegal activities took place between February and June 2021 and involved sophisticated tactics such as email phishing to target banks and credit card companies. Despite claiming to be unaware of the illicit origin of the funds, the jury found the evidence against him to be convincing.
Damian Williams, a US Attorney, emphasized the significance of the jury’s unanimous verdict as a deterrent against similar crimes. He highlighted the misuse of Mizrahi’s company for money laundering and stated, “The jury’s unanimous verdict sends a strong message that individuals who steal and introduce illicit funds into the US financial system will be held accountable.”
This case is not isolated to the United States. In India, the Enforcement Directorate has filed charges against 299 entities, including individuals of Chinese origin, for defrauding investors through a cryptocurrency mining scam. This action was prompted by a complaint filed by the Cyber Crimes Unit of Kohima Police, mirroring the deceptive tactics seen in Mizrahi’s case.
Another notable case in the fight against cryptocurrency fraud is the OneCoin scheme. Mark Scott, who was involved in laundering $400 million from the scheme, was sentenced to ten years in prison in January. The leaders of the scheme, Ruta Ignatova and Karl Sebastian Greenwood, received 20-year prison sentences, highlighting the challenges of regulating digital finances on a global scale. Ignatova’s brother was also recently released after completing a 34-month sentence for his involvement.
These developments come at a time when cryptocurrencies are facing increased scrutiny in relation to financial crimes. However, it is worth noting that despite the focus on digital currencies, the US Treasury Department has reported that traditional cash transactions remain the preferred method for money laundering among criminal organizations. The report attributes this preference to the anonymity and stability of cash, particularly US currency, compared to traceable blockchain transactions.
