A jury today convicted a New York man in connection with a scheme to defraud investors through the fraudulent trading and sale of cryptocurrencies.
According to court documents and evidence at trial, Randall Crater, 51, of East Hampton, founded My Big Coin Pay Inc., a purported Las Vegas-based cryptocurrency and virtual payment services company. Vegas Nevada offered virtual payment services through a fraudulent digital currency, “My Big Coins,” which was marketed to investors between 2014 and 2017 using misrepresentation about the nature and value of the coins.
Crater and his associates falsely claimed that Coins was a fully functioning cryptocurrency backed by $300 million worth of gold, oil, and other valuable assets. Crater also falsely told investors that My Big Coin partnered with MasterCard and that the coins could be easily exchanged for government-backed paper money or other virtual currencies.
In reality, the coins were not backed by gold or other valuable assets, had no association with MasterCard, and were not easily transferrable. Throughout the plot, Crater misappropriated more than $6 million in investor funds for his gain, including spending hundreds of thousands of dollars on fine antique art and jewelry.
The Crater was convicted of four counts of wire fraud, which carries a statutory maximum sentence of up to 20 years in prison on each count, and three counts of money laundering, which carries a statutory maximum sentence of up to 10 years in prison on each count. He is scheduled to be sentenced on October 27. A federal district court judge will determine any sentence after considering the US Sentencing Guidelines and other legal factors.