March 27, 2024
Ex-Deutsche Bank Executive Pleads Guilty in 'R3 Crypto Scam'
Latest Cryptocurrency News

Ex-Deutsche Bank Executive Pleads Guilty in ‘R3 Crypto Scam’

A former Deutsche Bank investment banker who was charged earlier in 2023 in connection with a fraudulent cryptocurrency trading scheme has entered a guilty plea for investment fraud and may potentially receive a maximum prison sentence of 30 years.

By a statement from the United States Department of Justice (DOJ) released on September 19, Rashawn Russell, aged 27, has admitted guilt about his involvement in a scheme involving the operation of a deceptive crypto investment fund called the “R3 Crypto Fund.”

During the period spanning from November 2020 to August 2022, Russell deceived 29 investors out of $1.5 million by exploiting his standing as an investment banker and licensed financial broker. He made assurances to investors that he could yield guaranteed, exceptionally high returns on a series of cryptocurrency investments. The DOJ revealed that Russell repeatedly provided false information to investors about their investments and generated counterfeit documents that falsely represented their returns.

The prosecution uncovered instances where Russell altered images of his bank balance when communicating with investors. On one occasion, when an investor sought to cash out their crypto investments, Russell failed to transfer the funds and instead sent a fabricated confirmation of a money transfer.

Prosecutors determined that a significant portion of the $1.5 million acquired from his victims was never actually invested in cryptocurrency assets. Instead, Russell diverted these funds for personal use, gambling, and repaying earlier participants in the fraudulent scheme. In addition to his involvement in the investment scheme, Russell also confessed to participating in a separate identity theft operation in which he fraudulently acquired credit cards and other items using false information.

The DOJ stated that Russell had procured these fraudulent identity documents with the intent of conducting illegal and unauthorized transactions.

Upon sentencing, Russell faces a potential prison term of up to 30 years for his offenses, and U.S. Magistrate Judge Sanket Bulsara has mandated that he must make restitution in the amount exceeding $1.5 million.

Image by storyset on Freepik

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