A Romanian programmer has pleaded guilty in connection with his role in creating the BitClub Network, a crypto mining scam that defrauded $722 million from investors. The Romanian programmer now faces five years in prison and a fine of $250,000. The US Department of Justice revealed in a press release that Silviu Balaci was arrested in Germany, where he had been residing. The scammer pleaded guilty, via video conference, to one count of dual-object conspiracy to commit the wire fraud.
Romanian programmer was one of the key operators in the scam.
Silviu Balaci was one of the key operators of the BitClub Network that defrauded $722 million from its investors in an elaborate crypto mining scam. BitClub Network solicited investment from the US citizens for purported shares in a digital currency block reward mining operation. The company operated from April 2014 to December 2019 acted as a multi-level marketing scam where it rewarded investors who recruited new members. Balaci allegedly was responsible for handling the company’s technical aspect, with fellow defendants Matthew Goettsche and Russ Albert Medlin attending to marketing and other business matters. According to the US DoJ, Balaci referred to potential investors as ‘dumb’ and claimed that they were “building this whole model on the backs of idiots.”
BitClub co-founder Russ Albert Medlin was also was arrested.
The Romanian programmer pleaded guilty in the US court three weeks after the other BitClub co-founder, Russ Albert Medlin, was arrested. The Indonesian police arrested the other co-founder, and he currently faces charges of sexually assaulting minors. The police acted on tip-offs from his neighbors in Jakarta, who had noticed several minors leaving his house. Medlin would 15 years in prison if he is convicted in Indonesia for breaking the country’s Law on Children Protection. However, he might be extradited to the US for his role in the $722 million crypto scam.