KEY POINTS
David Brend and Gustavo Rodriguez could be sentenced to two decades in jail for participating in a “Ponzi” scheme.
The judicial proceedings on March 14 revealed that David Carmona, identified as the architect of IcomTech, enlisted Rodriguez’s expertise in website development for the firm during the middle of 2018. The website eventually became a scam, defrauding tens of thousands of people out of tens of millions of dollars.
How The Ponzi Scheme Operated
IcomTech lured investors with the promise of consistent daily profits derived from its purported involvement in cryptocurrency trading and mining operations. The prosecution, however, contends that these operations were fictitious and that the enterprise was orchestrating a Ponzi scheme.
Rodriguez played a part in crafting deceptive investment plans and altering the daily profits shown to investors on the web platform he oversaw. Brend, along with other associates, faced allegations of misappropriating significant investor funds for personal indulgences, such as buying property, financing opulent trips, and staging lavish events to lure more capital.
These gatherings showcased high-end cars and apparel to convey an aura of affluence and fiscal triumph. The operation crumbled in 2019 when the firm couldn’t honor cash-out requests, offering instead the “Icoms” token as an alleged fix.
Magnitude of The Fraud
U.S. Attorney for the Southern District of New York, Damian Williams, underscored the gravity of the fraud, noting that it swindled substantial sums of money from a vast number of individuals, thereby underlining the extensive economic harm inflicted upon investors who were attempting to augment their savings.
The court will pass judgment on Brend on June 27, with Rodriguez’s sentencing following on June 28. The guilty verdicts for Brend and Rodriguez echo a similar crypto-related court case involving Roman Sterlingov, a founding partner of Bitcoin Fog.
In a separate incident, just last month, BitForex, a cryptocurrency exchange headquartered in Hong Kong, abruptly ceased operations, causing panic and bewilderment among its users. Since then, it has remained unresponsive to any inquiries or messages, raising suspicions of fraudulent activity.
