A federal court in Boston sentenced the founder of My Big Coin on charges of promoting and selling a fraudulent virtual currency and operating an unlicensed digital-asset exchange service.
Randall Crater, the founder of “My Big Coin,” a purported cryptocurrency company, was sentenced today to more than eight years in federal prison for a multi-million dollar fraud scheme uncovered by #FBI Boston and @USPIS_BOS. https://t.co/567NYPndRU pic.twitter.com/a3eKaogij4
— FBI Boston (@FBIBoston) January 31, 2023
The judge, Denise J. Casper, sentenced 52-year-old Randall Crater to 100 months in prison, to reimburse investors about $7.67 million in losses and to pay restitution. The exact amount of the latter will be determined later.
According to the statement, the defendant founded My Big Coin in 2013. The firm offered digital-payment services through its own cryptocurrency.
The founder and the associated providers assured investors, who were sold the digital asset over roughly three years, that it was backed by gold. They also falsely claimed a partnership with MasterCard and promoted the My Big Coin Exchange as a cryptocurrency exchange. On the platform, the coin could allegedly be exchanged for fiat or other digital assets at all times, which was not true.
During the scheme, Crater attracted funds from no fewer than 55 investors. He used the money to purchase a home, cars, and items of antiquity, art, and jewelry totaling about $1 million.
In 2018, the U.S. Securities and Exchange Commission filed suit against the founder of My Big Coin on charges of fraud. The civil case was put on hold following a criminal investigation into Crater in 2019. The combined task force included representatives from the Office of the Attorney General, the FBI, and the Treasury Department FinCEN.
“By spreading outright lies, Randall Crater defrauded dozens of victims of more than $7.5 million, convincing them that their investments were backed by gold. In reality, the money earned by their labor went to sustain his luxurious lifestyle,” commented FBI special agent Joseph Bonavolonta of the Boston field office.
In December 2022 pleaded guilty, co-founder of OneCoin Sebastian Greenwood. The whereabouts of the second organizer of the roughly $4 billion scheme, Ruja Ignatova, has been unknown since 2017.