US citizen charged with operating diamond Ponzi plot, cryptocurrency scam

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US citizen charged with operating diamond Ponzi plot, cryptocurrency scam

US citizen charged with operating diamond Ponzi plot, cryptocurrency scam

A 51-twelve months-venerable US citizen has been charged with operating a diamond and cryptocurrency-basically based Ponzi plot.

Prosecutors narrate that Jose Angel Aman, from Washington, DC., operated a deceptive funding plot all the draw in which thru the United States and Canada, luring investors with promises of rapid returns in the diamond trade.

The US Department of Justice (DoJ) acknowledged on Friday that Aman used to be the operator of a Ponzi plot from Would possibly maybe maybe maybe honest 2014 to Would possibly maybe maybe maybe honest 2019. Together along with his companions, Aman allegedly solicited other folks to make investments in “diamond contracts,” whereby their money would be extinct to steal enormous, tough, uncut diamonds. 

These diamonds would then be decrease and polished in declare to be resold at a earnings. To instill trust in the group, Aman acknowledged that funds had been backed by his fetch physical colored diamond inventory, it looks price $25 million. 

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As is the case with many Ponzi and gain-affluent-rapid schemes, investors demand to glimpse a decrease of the earnings and with out this, Ponzi schemes are uncovered and collapse rapidly. Therefore, Aman allegedly extinct investor funds to repay earlier funding “passion,” and as more investors joined the pool, the transfer of funds down the chain continued — with out any official earnings got from diamond purchases. 

When funds ran low and the operator used to be inclined to being uncovered, he allegedly created “Reinvestment Contracts” to entice users to roll over their money into contemporary ‘deals’ in declare to steal Aman time to register contemporary investors. 

On the different hand, this would maybe maybe well now not carry on forever, and US prosecutors explain that Aman place up Argyle Coin because the Ponzi plot used to be on the breaking level. Argyle Coin claimed to be a cryptocurrency-mission backed by diamond buying and selling, and as a contemporary wave of funding poured into the coffers, handiest a “half of the money got” used to be extinct to form a cryptocurrency token.

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As a change, the DoJ says the massive majority of the funds had been extinct to repay investors from the previous Ponzi program, beneath the names Natural Diamonds Funding Co. (Natural Diamonds) and Eagle Monetary Diamond Community Inc (Eagle). 

“At some stage all thru the Ponzi plot, Aman and his companions restful over $25 million from hundreds of investors,” prosecutors explain. “Aman allegedly extinct the money to invent purported passion funds to investors, to pay enterprise charges, to pay commissions to the companions, and to make stronger his fetch lavish draw of life.”

Investor funds had been allegedly extinct for applications at the side of housing hire, horse purchases, and utilizing lessons.

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In 2019, the Securities and Change Commission (SEC) got an emergency court docket declare to freeze Argyle Coin’s operations. The US District Court docket for the Southern District of Florida granted a demand for a momentary restraining declare and asset freeze whereas the cryptocurrency group used to be investigated. 

Aman is dealing with charges of wire fraud, which would maybe consequence in up to 20 years on the reduction of bars, as well as restitution funds. 

Old and connected coverage

  • 2gether hacked: €1.2m in cryptocurrency stolen, native tokens equipped in alternate
  • IRS provides grants for machine to hint privacy-centered cryptocurrency trades
  • Lazarus neighborhood strikes cryptocurrency firm thru LinkedIn job adverts

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