NEW YORK - A former investment banker and registered broker was sentenced to 41 months in prison for orchestrating a cryptocurrency investment fraud that caused approximately $1.5 million in losses to investors, the U.S. Department of Justice announced Thursday.
Rashawn Russell, 28, from Brooklyn, New York, was convicted of engaging in a fraudulent scheme between November 2020 and August 2022 where he deceived investors with false promises of substantial returns on cryptocurrency investments. Instead of investing the funds as promised, Russell misappropriated them for personal use, gambling, and to repay other investors. When investors sought their returns, Russell failed to repay the principal or provide the promised returns, and in some cases falsely claimed he had wired the funds back to them.
In a separate but related case, Russell was found to have fraudulently obtained at least 97 credit and debit cards and 43 identification cards, primarily from gym lockers in New York and New Jersey, which he used to open online gambling accounts and make unauthorized purchases between September 2021 and June 2023.
The sentence also includes an order for Russell to pay over $1.5 million in restitution to the victims of his cryptocurrency scheme. Russell pleaded guilty to charges of wire fraud and access device fraud in September 2023.
The U.S. Postal Inspection Service conducted the investigation that led to Russell's prosecution. The case was prosecuted by Trial Attorney Kyle Crawford and Assistant Chief Scott Armstrong of the Criminal Division’s Fraud Section, along with Assistant U.S. Attorney Drew Rolle for the Eastern District of New York.
This sentencing comes amid a series of actions by the Justice Department to combat financial fraud, particularly in the cryptocurrency market. The information is based on a press release statement from the Department of Justice.
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