Six executives of the cryptocurrency Ponzi scam AirBit Club have pleaded guilty, according to the US Attorney for the Southern District of New York, for their participation in a network of worldwide money laundering and fraud schemes.
The owners of AirBit Club are said to have made about $100 million over a five-year period. This includes co-founders Gutemberg Dos Santos and Pablo Renato Rodriguez, their lawyer Scott Hughes, and AirBit promoters Cecilia Millan, Karina Chairez, and Jackie Aguilar, who have all admitted guilt to charges involving money laundering, wire fraud, and conspiracy to commit bank fraud.
US Attorney Damian Williams said in a statement that the six executives used the increasing buzz surrounding the asset class to dupe unwary victims into parting with millions of dollars by making false claims that their money was being invested in bitcoin trading and mining.
“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. These guilty pleas send a clear message that we are coming after all of those who seek to exploit cryptocurrency to commit fraud.”
The investigators concluded that Rodriguez, Dos Santos, Hughes, Chairez, and Millan asked the victims to pay for memberships with cash through outside cryptocurrency brokers. The illicit money from the AirBit Club Scheme was subsequently laundered through a number of local and international bank accounts, including a lawyer trust account that Hughes oversaw.
The lawyer used this account to pay for his and the co-founders’ and promoters’ personal costs. The AirBit Club Plan was further promoted by using these revenues for sponsorships and promotional activities.
All of the accused, who were charged for the first time in August 2020, traveled across the United States, South America, Asia, and Eastern Europe, presenting “lavish” expos and small community talks to persuade victims to buy AirBit Club memberships.
According to the prosecution, the victims could see “earnings” accumulating on their online portal. Nevertheless, no real mining or trade of Bitcoin on behalf of the victims occurred. Instead, the scammers “enriched themselves,” buying expensive vehicles, jewelry, and mansions while funding more opulent expos to lure in more victims.