My Big Coin cryptocurrency firm founder gets 8 years in prison for fraud

BOSTON, Jan 31 (Reuters) – The founding father of a defunct cryptocurrency enterprise was sentenced on Tuesday to greater than eight years in jail for defrauding buyers and prospects out of thousands and thousands of {dollars} by advertising and marketing a digital foreign money referred to as My Massive Coin with lies and half-truths.

Federal prosecutors had urged U.S. District Decide Denise Casper in Boston to impose a 13-year jail time period on Randall Crater to ship a message to others within the first sentencing of a cryptocurrency firm founder for a advertising and marketing fraud.

Whereas Casper concluded that that request went too far, she rejected Crater’s competition {that a} 30-month jail time period was adequate to punish him for his false claims, together with that My Massive Coin was an actual cryptocurrency backed by gold.

“Actually cryptocurrency is a more moderen enterprise, a more moderen market, a twenty first Century market,” Casper mentioned. “However the scheme at its core was age-old, and that was fraud.”

Crater, who was sentenced to 100 months in whole and ordered to forfeit practically $7.7 million, is anticipated to enchantment. In court docket, he apologized however mentioned he by no means meant to defraud anybody.

“I didn’t got down to steal cash from anybody,” he mentioned. “That doesn’t imply I’m not remorseful.”

A jury in July discovered Crater, 52, guilty of committing wire fraud and making illegal financial transactions in a prosecution that spilled out of a precedent-setting case by the U.S. Commodity Futures Buying and selling Fee.

The CFTC’s 2018 lawsuit in opposition to Crater and his failed firm, Nevada-based My Massive Coin Inc, led to one of many first court docket rulings holding {that a} digital foreign money could possibly be thought of a commodity inside the regulator’s jurisdiction.

Prosecutors subsequently secured Crater’s indictment in 2019 and accused him of inflicting buyers and prospects to lose $7.5 million from 2014 to 2017 with lies about My Massive Coin, whose identify sounded much like the favored digital foreign money bitcoin.

Prosecutors mentioned these false claims included that My Massive Coin was an actual digital foreign money, was backed by gold and had a partnership with MasterCard (MA.N). Prosecutors mentioned he used the cash to purchase vehicles, jewellery, art work and vintage cash.

Reporting by Nate Raymond in Boston
Modifying by Invoice Berkrot

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