Mining Capital Coin CEO accused of $62 mln funding fraud
Mining Capital Coin CEO Luiz Capuci Jr. is accused of orchestrating a $62 million cryptocurrency fraud scheme
By Shashank Bhardwaj
The US Division of Justice (DOJ) has charged Luiz Capuci, the CEO and co-founder of crypto mining and funding platform Mining Capital Coin (MCC), with “purportedly orchestrating a $62 million world funding fraud conspiracy.”
In reference to varied allegedly fraudulent operations run through MCC, the DOJ has charged Capuci with conspiracy to commit wire fraud, conspiracy to commit securities fraud, and conspiracy to interact in worldwide cash laundering. He dangers a most jail sentence of 45 years if convicted.
Capuci allegedly promised “vital revenue and assured returns by utilizing traders’ cash to mine new cryptocurrencies” as a part of the mining packages however allegedly did not ship on the promise. Capuci can also be accused of selling dodgy MCC buying and selling bots that would execute “1000’s of trades per second” and create each day returns for traders.
“As he did with the Mining Packages, nevertheless, Capuci allegedly operated an funding fraud scheme with the Buying and selling Bots and was not, as he promised, utilizing MCC Buying and selling Bots to generate revenue for traders, however as a substitute was diverting the funds to himself and co-conspirators,” the DOJ indictment reads.
On the identical day because the DOJ’s indictment, the SEC issued fraud allegations towards MCC, co-founder Emerson Pires, Capuci, and two firms managed by Capuci, CPTLCoin Corp. and Bitchain Exchanges.
Based on the SEC’s grievance, “MCC, Capuci, and Pires bought mining packages to 65,535 traders worldwide and promised each day returns of 1 p.c, paid weekly” over the course of a 12 months.
As acknowledged by the SEC, traders have been promised Bitcoin (BTC) income at first; nevertheless, it was later modified to MCC’s Capital Coin, which might solely be redeemed on Bitchain, a “faux crypto asset buying and selling web site established and maintained by Capuci.”
Customers have been solely given the choice of buying one other mining bundle or forfeiting their funds when it got here time to withdraw their funds. The SEC alleges that Pires and Capuci “pocketed a minimum of $8.1 million from the sale of the mining packages and $3.2 million in initiation charges.”
“Because the grievance 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 Property and Cyber Unit.
Final month, the District Court docket for the Southern District of Florida granted a brief restraining order and an order freezing the defendants’ belongings, in response to the SEC.
Shashank is the founder at yMedia. He ventured into crypto in 2013 and is an ETH maximalist. Twitter: @bhardwajshash