The CEO and co-founder of crypto mining and investment platform Mining Capital Coin (MCC) Luiz Capuci Jr. has been indicted by the Division of Justice (DOJ) for “allegedly orchestrating a $62 million international investment fraud scheme.”
The DOJ is charging Capuci with conspiracy to commit wire fraud, conspiracy to commit securities fraud, and conspiracy to commit worldwide cash laundering in relation to a number of allegedly fraudulent schemes that had been run through MCC. If discovered responsible, he faces a most jail sentence of 45 years.
In keeping with the DOJ’s indictment, Capuci (alongside unnamed co-conspirators) is accused of deceptive traders over the profit-bearing potential of MCC mining packages and a local token dubbed Capital Coin that was backed by the “greatest cryptocurrency mining operation on the earth. ”
As half of the mining packages, Capuci is claimed to have touted “substantial earnings and assured returns by utilizing traders’ cash to mine new cryptocurrency” however allegedly didn’t ship on the cut price:
“As alleged within the indictment, nonetheless, Capuci operated a fraudulent investment scheme and didn’t use traders’ funds to mine new cryptocurrency, as promised, however as a substitute diverted the funds to cryptocurrency wallets beneath his management.”
Capuci can be accused of advertising doubtful MCC buying and selling bots “with new expertise by no means seen earlier than” that might conduct “hundreds of trades per second “and generate day by day returns for traders.
“As he did with the Mining Packages, nonetheless, Capuci allegedly operated an investment fraud scheme with the Buying and selling Bots and was not, as he promised, utilizing MCC Buying and selling Bots to generate earnings for traders, however as a substitute was diverting the funds to himself and co -conspirators,” the DOJ indictment reads.
Moreover, the MCC CEO and co-founder allegedly recruited MCC promoters and associates as half of a multi-level advertising scheme. In return for luring traders into the MCC ecosystem, Capuci is claimed to have promised something from “Apple watches and iPads to luxurious autos reminiscent of a Lamborghini, Porsche” and even his personal private Ferrari.
“Capuci additional hid the situation and management of the fraud proceeds obtained from traders by laundering the funds internationally by means of numerous foreign-based cryptocurrency exchanges.”
The DOJ’s indictment was additionally introduced on the identical day that the US Securities and Change Fee (SEC) outlined fraud expenses in opposition to MCC, co-founder Emerson Pires, Capuci, and two entities managed by Capuci in CPTLCoin Corp. (CPTLCoin) and Bitchain Exchanges (Bitchain).
In keeping with the SEC’s criticism, “MCC, Capuci, and Pires offered mining packages to 65,535 traders worldwide and promised day by day returns of 1 %, paid weekly” over the course of a yr.
The SEC alleged that traders had been initially promised returns in Bitcoin (BTC), nonetheless this was subsequently modified to MCC’s Capital Coin (CPTL), which may solely be redeemed on “a pretend crypto asset buying and selling platform Capuci created and managed” referred to as Bitchain.
Nonetheless, when it got here time for customers to withdraw their funds, they had been solely capable of buy one other mining package deal or forfeit their funds.
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The SEC alleges that Pires and Capuci “netted a minimum of $8.1 million from the sale of the mining packages and $3.2 million in initiation charges.”
“Because the criticism alleges, Capuci and Pires took each alternative to extract more cash from unsuspecting traders on false guarantees of outlandish returns and used investor funds raised from this fraudulent scheme to fund a lavish life-style, together with buying Lamborghinis, yachts, and actual property, ” mentioned A. Kristina Littman, chief of the SEC enforcement division’s Crypto Belongings and Cyber Unit.
The SEC additionally acknowledged that the District Courtroom for the Southern District of Florida issued a brief restraining order in opposition to the defendants final month and an order to freeze their property.
