US citizen charged with running diamond Ponzi scheme, cryptocurrency scam

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US citizen charged with running diamond Ponzi scheme, cryptocurrency scam

US citizen charged with running diamond Ponzi scheme, cryptocurrency scam

A 51-yr-old US citizen has been charged with running a diamond and cryptocurrency-basically based fully fully Ponzi scheme.

Prosecutors claim that Jose Angel Aman, from Washington, DC., operated a fraudulent funding scheme all around the United States and Canada, luring traders with promises of rapid returns within the diamond trade.

The US Division of Justice (DoJ) acknowledged on Friday that Aman became the operator of a Ponzi scheme from Would possibly perchance perhaps merely 2014 to Would possibly perchance perhaps merely 2019. With his partners, Aman allegedly solicited other folks to make investments in “diamond contracts,” all over which their money could well be extinct to purchase neat, tough, uncut diamonds. 

These diamonds would then be minimize and polished so to be resold at a profit. To instill belief within the organization, Aman acknowledged that funds delight in been backed by his maintain physical coloured diamond stock, it sounds as if price $25 million. 

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As is the case with many Ponzi and accumulate-prosperous-rapid schemes, traders request to peep a minimize of the profits and without this, Ponzi schemes are exposed and crumple hasty. Because of the this truth, Aman allegedly extinct investor funds to repay earlier funding “passion,” and as more traders joined the pool, the transfer of funds down the chain continued — with none official profit obtained from diamond purchases. 

When funds ran low and the operator became at possibility of being exposed, he allegedly created “Reinvestment Contracts” to entice users to roll over their cash into new ‘deals’ so to purchase Aman time to register new traders. 

However, this is in a position to perhaps now not elevate on forever, and US prosecutors explain that Aman jam up Argyle Coin because the Ponzi scheme became on the brink. Argyle Coin claimed to be a cryptocurrency-project backed by diamond trading, and as a fresh wave of funding poured into the coffers, completely a “part of the money got” became extinct to originate a cryptocurrency token.

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As an change, the DoJ says the majority of the funds delight in been extinct to repay traders from the old Ponzi program, under the names Natural Diamonds Funding Co. (Natural Diamonds) and Eagle Monetary Diamond Neighborhood Inc (Eagle). 

“Ultimately of the route of the Ponzi scheme, Aman and his partners quiet over $25 million from hundreds of traders,” prosecutors explain. “Aman allegedly extinct the money to originate purported passion funds to traders, to pay enterprise costs, to pay commissions to the partners, and to offer a bewitch to his maintain lavish standard of living.”

Investor funds delight in been allegedly extinct for purposes collectively with housing lease, horse purchases, and using classes.

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In 2019, the Securities and Switch Price (SEC) obtained an emergency court docket verbalize to freeze Argyle Coin’s operations. The US District Court for the Southern District of Florida granted a request for a temporary restraining verbalize and asset freeze whereas the cryptocurrency organization became investigated. 

Aman is dealing with charges of wire fraud, which could well lead to as much as 20 years unhurried bars, to boot to restitution funds. 

Previous and associated coverage

  • 2gether hacked: €1.2m in cryptocurrency stolen, native tokens equipped in alternate
  • IRS offers grants for tool to hint privateness-focused cryptocurrency trades
  • Lazarus team strikes cryptocurrency firm through LinkedIn job adverts

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