Ex-Banker’s Fraud Scheme
Rashawn Russell, a former investment banker, has been sentenced to 41 months in federal prison for his role in a cryptocurrency fraud scheme that resulted in $1.5 million in investor losses.
The Scheme
Russell targeted friends, former classmates, and co-workers, promising them high returns on investments in his R3 Crypto Fund. He used his industry experience and broker registration to create a facade of legitimacy, fabricating documents and providing fake wire transfer confirmations.
In reality, Russell used investor funds to repay earlier investors in a Ponzi scheme, while also diverting money for personal expenses and gambling.
Identity Theft
In addition to the cryptocurrency fraud, Russell also acquired nearly 100 credit and debit cards under other people’s names, intending to use them for fraudulent transactions.
DOJ’s Crackdown
The Department of Justice (DOJ) has been intensifying its efforts to combat crypto fraud. The National Cryptocurrency Enforcement Team (NCET) is targeting crypto exchanges and investment scams.
The DOJ is also focusing on cross-chain bridges and theft in the decentralized finance (DeFi) realm.
Rising Crypto Fraud
The FBI estimates that $3.31 billion was stolen through investment fraud in 2022, with crypto-related scams accounting for over $2.5 billion. The DOJ has seen a significant increase in crypto-related criminal incidents in recent years.
