US citizen charged with running diamond Ponzi diagram, cryptocurrency scam

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US citizen charged with running diamond Ponzi diagram, cryptocurrency scam

US citizen charged with running diamond Ponzi diagram, cryptocurrency scam

A 51-year-extinct US citizen has been charged with running a diamond and cryptocurrency-primarily based mostly mostly Ponzi diagram.

Prosecutors grunt that Jose Angel Aman, from Washington, DC., operated a fallacious investment diagram across the US and Canada, luring merchants with promises of rapid returns in the diamond alternate.

The US Department of Justice (DoJ) acknowledged on Friday that Aman became once the operator of a Ponzi diagram from Could well maybe 2014 to Could well maybe 2019. Together along with his companions, Aman allegedly solicited people to make investments in “diamond contracts,” in which their money would possibly well maybe well be used to pick ravishing, rough, uncut diamonds. 

These diamonds would then be carve and polished in deliver to be resold at a profit. To instill belief in the organization, Aman acknowledged that funds had been backed by his occupy bodily colored diamond stock, interestingly payment $25 million. 

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As is the case with many Ponzi and receive-well off-rapid schemes, merchants request to proceed attempting to search out a carve of the earnings and without this, Ponzi schemes are exposed and give way like a flash. Attributable to this truth, Aman allegedly used investor funds to repay earlier investment “ardour,” and as more merchants joined the pool, the transfer of funds down the chain continued — with none official profit received from diamond purchases. 

When funds ran low and the operator became once at possibility of being exposed, he allegedly created “Reinvestment Contracts” to entice users to roll over their money into new ‘deals’ in deliver to pick Aman time to trace up new merchants. 

On the opposite hand, this will likely maybe maybe no longer preserve on eternally, and US prosecutors disclose that Aman diagram up Argyle Coin because the Ponzi diagram became once on the brink. Argyle Coin claimed to be a cryptocurrency-venture backed by diamond shopping and selling, and as a peculiar wave of investment poured into the coffers, simplest a “portion of the money received” became once used to form a cryptocurrency token.

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In its place, the DoJ says the majority of the funds had been used to repay merchants from the outdated Ponzi program, below the names Pure Diamonds Funding Co. (Pure Diamonds) and Eagle Financial Diamond Community Inc (Eagle). 

“At some stage all via the Ponzi diagram, Aman and his companions restful over $25 million from an total bunch of merchants,” prosecutors disclose. “Aman allegedly used the money to form purported ardour payments to merchants, to pay alternate charges, to pay commissions to the companions, and to reduction his occupy lavish lifestyle.”

Investor funds had been allegedly used for functions including housing rent, horse purchases, and riding classes.

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In 2019, the Securities and Substitute Rate (SEC) received an emergency court docket deliver to freeze Argyle Coin’s operations. The US District Courtroom for the Southern District of Florida granted a ask for a transient-length of time restraining deliver and asset freeze whereas the cryptocurrency organization became once investigated. 

Aman goes via charges of wire fraud, which would possibly well maybe well consequence in as a lot as 20 years leisurely bars, moreover as restitution payments. 

Outdated and related protection

  • 2gether hacked: €1.2m in cryptocurrency stolen, native tokens equipped in alternate
  • IRS presents grants for tool to tag privateness-focused cryptocurrency trades
  • Lazarus group strikes cryptocurrency company via LinkedIn job adverts

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