19 November 2019, AtoZMarkets – ICOs, or initial coin offerings, have been a hot market during the Bitcoin craze, and in 2017 and 2018. Investors have poured over $ 20 billion into some 3,000 of these transactions. In these operations, the crypto-visionaries sell virtual pieces intended to finance their digital dreamers. The unregulated market has attracted people who had interesting ideas about money and technology. But it also becomes a hub for hucksters and con artists.
RECoin ICO Fraud Case
At one point, Paris Hilton and boxer Floyd Mayweather got on the bandwagon, touting the ICOs. Maksim Zaslavskiy is a Sheepshead Bay computer programmer with a master's degree in finance and law. He embarked on this wilderness of Wall Street two years ago. At the time, he launched an ICO for Recoin. That was supposed to help to buy a property. He issued many false and misleading statements about the ICO. He said, that was supported by real estate investments in the US and abroad and led by experienced real estate professionals.
Later, he turned to the marketing of a coin that he described as an "exclusive and tokenized membership pool" covered by diamonds. It was not true either. However, the craze for cryptography has been so intense in the summer of 2017. That about 1,000 investors have taken the bait and invested at least $ 300,000 in the Zaslavskiy ICOs.
His lawyer, Mildred Whalen, of the New York Federal Defenders, argued that Mr. Zaslavskiy had repaid as much money. He could before PayPal froze his clients' accounts, fearing that payments for his ICOs would are made with stolen or fraudulent credit cards.
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First-person who charged
Zaslavskiy became the first person charged with criminal fraud by the ICO. At the time, federal prosecutors filed a complaint against him in 2017. And he also pleaded guilty last year to conspiracy to commit securities fraud. Zaslavkiy came from the USSR and immigrated to New York in 1991 with his family when he was 12 years old.
He told Federal Judge Raymond Dearie that he was sorry for doing things he knew were wrong. "At no time am I a thief," he insists in Brooklyn federal court on Monday morning. "You are a thief," said Dearie. "You got something that did not belong to you under false pretenses."
Assistant Attorney General Julie Nestor pointed out that cases like Zaslavskiy's are "a dozen dimes." And that needs a severe sentence to send a message to other scammers in the cryptocurrency world. Judge Dearie agreed. "This is a very unusual case for a lot of reasons, which involves new technologies and new currencies," he said. "But there is nothing new in lying or flagrant fraud."
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