Former Deutsche Bank investment banker Rashon Russell pleads guilty to involvement in a scam defrauding 29 clients of the crypto fund R3 of $1.5 million.
According to federal court in Brooklyn, the defendant also admitted to stealing personal information, including credit card data and access to electronic devices, with the intent to use them for unauthorized transactions.
“Russell exploited investors’ interest in the cryptocurrency markets to implement a scheme defrauding clients who trusted him. The swift verdict in this case underscores the authorities’ commitment to holding wrongdoers to account in the digital-asset markets,” said U.S. Attorney Breon Peace.
According to court filings, from November 2020 through August 2022, the former Deutsche Bank broker defrauded investors in the R3 fund by promising profits from cryptocurrency trading.
He siphoned off most of the funds for gambling, paying down debts to previous investors, and covering his own expenses, the court said.
The defendant faces a maximum sentence of up to 30 years in prison. As part of the plea agreement he must pay restitution of more than $1.5 million.
Earlier, one of the founders of the cryptocurrency pyramid OneCoin, Karl Sebastian was sentenced to 20 years in prison and a $300 million fine. He was convicted of defrauding 3.5 million investors and misappropriating their funds for five-star resorts, villas, a private jet and a yacht.
As reported in June, U.S. authorities charged a Tennessee couple with organizing a $6 million cryptocurrency investment scheme called “Blessing of God Through Cryptocurrency.”