US citizen charged with working diamond Ponzi scheme, cryptocurrency rip-off

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US citizen charged with working diamond Ponzi scheme, cryptocurrency rip-off

US citizen charged with working diamond Ponzi scheme, cryptocurrency rip-off

A 51-year-oldschool US citizen has been charged with working a diamond and cryptocurrency-based mostly utterly mostly Ponzi scheme.

Prosecutors narrate that Jose Angel Aman, from Washington, DC., operated a groundless funding scheme across the US and Canada, luring shoppers with guarantees of instant returns within the diamond substitute.

The US Division of Justice (DoJ) acknowledged on Friday that Aman became once the operator of a Ponzi scheme from Might also 2014 to Might also 2019. Together alongside with his partners, Aman allegedly solicited individuals to spend money on “diamond contracts,” whereby their money may maybe most doubtless perchance well be extinct to defend terminate gargantuan, rough, uncut diamonds. 

These diamonds would then be lower and polished in direct to be resold at a revenue. To instill belief within the group, Aman acknowledged that funds were backed by his dangle physical colored diamond stock, curiously price $25 million. 

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As is the case with many Ponzi and fetch-effectively to do-instant schemes, shoppers request to appear a lower of the earnings and with out this, Ponzi schemes are exposed and crumple rapidly. Due to this reality, Aman allegedly extinct investor funds to pay off earlier funding “ardour,” and as extra shoppers joined the pool, the transfer of funds down the chain continued — with none loyal revenue obtained from diamond purchases. 

When funds ran low and the operator became once at threat of being exposed, he allegedly created “Reinvestment Contracts” to entice users to roll over their cash into new ‘deals’ in direct to defend terminate Aman time to register new shoppers. 

Alternatively, this couldn’t keep it up perpetually, and US prosecutors utter that Aman keep of dwelling up Argyle Coin as the Ponzi scheme became once on the breaking level. Argyle Coin claimed to be a cryptocurrency-mission backed by diamond trading, and as a contemporary wave of funding poured into the coffers, easiest a “fraction of the money obtained” became once extinct to compose a cryptocurrency token.

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As a change, the DoJ says the majority of the funds were extinct to pay off shoppers from the old Ponzi program, beneath the names Natural Diamonds Funding Co. (Natural Diamonds) and Eagle Financial Diamond Neighborhood Inc (Eagle). 

“At some level of the direction of the Ponzi scheme, Aman and his partners serene over $25 million from hundreds of shoppers,” prosecutors utter. “Aman allegedly extinct the money to impress purported ardour payments to shoppers, to pay business costs, to pay commissions to the partners, and to strengthen his dangle lavish daily life.”

Investor funds were allegedly extinct for capabilities including housing hire, horse purchases, and utilizing classes.

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In 2019, the Securities and Alternate Commission (SEC) obtained an emergency court docket direct to freeze Argyle Coin’s operations. The US District Court for the Southern District of Florida granted a ask for a temporary restraining direct and asset freeze while the cryptocurrency group became once investigated. 

Aman is facing costs of wire fraud, which may maybe most doubtless perchance well consequence in up to 20 years within the support of bars, as effectively as restitution payments. 

Old and linked coverage

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  • IRS provides grants for tool to trace privacy-centered cryptocurrency trades
  • Lazarus community strikes cryptocurrency firm through LinkedIn job adverts

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