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U.S. Authorities Charge Two Men in $650 Million Crypto Scam Involving Bitcoin (BTC)

U.S. Authorities Charge Two Men in $650 Million Crypto Scam Involving Bitcoin (BTC)

Federal U.S. prosecutors have charged two men in connection with a cryptocurrency investment scheme that defrauded victims of $650 million.

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The indictment accuses Michael Sims, age 48, of Florida, and Juan Reynoso, age 57, of New Jersey, of operating and promoting OmegaPro, an international crypto multi-level marketing scheme that promised investors 300% returns over a 16-month period.

“OmegaPro promised financial freedom but delivered financial ruin,” said the Internal Revenue Service (IRS) in a news release announcing the charges. From 2019 to 2023, Sims, Reynoso, and their co-conspirators lured thousands of victims worldwide to purchase “investment packages” using crypto such as Bitcoin (BTC), and falsely claiming the funds would be managed by forex traders.

Prosecutors claim the pair flaunted their wealth through social media and extravagant events, including projecting the OmegaPro logo onto the Burj Khalifa, Dubai’s tallest building. In reality, authorities allege that OmegaPro was nothing more than a pyramid scheme.

Multiple Charges

When the company claimed it had suffered a hack, the defendants told victims they had transferred their funds to a new platform called Broker Group. However, users were never able to withdraw their money from either platform and lost a combined $650 million.

The two men face charges of conspiracy to commit wire fraud and conspiracy to commit money laundering, each carrying a maximum sentence of 20 years in prison. The U.S. Justice Department, FBI, and IRS led the multiagency investigation that resulted in charges being brought against the men.

Bitcoin, the largest cryptocurrency by market capitalization, has gained 17% this year.

Is BTC a Buy?

Most Wall Street firms don’t offer ratings or price targets on cryptocurrencies such as Bitcoin, so we’ll look instead at its three-month performance. As one can see in the chart below, the price of BTC has risen 31.76% in the last 12 weeks.

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