Cybercriminals have been replicating web apps of digital assets companies and financial institutions to defraud investors, even using logos and information of legitimate companies, according to the FBI.
The FBI is reported to be teaming up with liquidators managing the assets of Mirror Trading International, acting on behalf of U.S.-based investors who have been left short in the collapse of the exchange.
The OIG called on FBI to implement a better strategy for not just its dark web investigations, but also for digital currency-related activities.
When the FBI tried to arrest Matthew Piercey on Monday, he jumped into a pickup truck and led them on a wild chase that went off-road twice. Eventually, he stopped on the shores of Lake Shasta, California’s largest reservoir and dived in with an underwater submersible device. The daring 44-year-old stayed under water for 35 minutes, local outlets reported. The agents monitored his location by following the bubbles that floated to the surface.
When he came out of the water, the agents were in hand to arrest him.
Piercey was indicted last week by a federal grand jury, together with his business partner Kenneth Winton. According to court filings, the two have been operating Family Wealth Legacy and Zolla Financial since at least July 2015. They targeted high net worth individuals, with the minimum investment standing at $50,000.
In that time, they have lured $35 million from investors, promising huge returns using an “Upvesting Fund.” The two allegedly told investors that the fund relied on algorithmic trading and had a long history of success.
Piercey additionally used his standing at his local church to lure investors, a law enforcement agent told local news outlets.
One of the fields they claimed to be directing the investors’ funds to was BTC mining. However, according to one lawyer representing the investors, the two didn’t have the faintest idea about BTC mining.
Piercey now faces several charges, including mail fraud, money laundering and wire fraud. Prosecutors are also charging him with witness tampering for letters he wrote to some investors who had been subpoenaed to testify against him in court.
As per a local newspaper, Piercey told the investors that they were getting summoned because he had written to President Donald Trump. He claimed to have sent Trump a “bold proposal to rescue the country’s banking system.” Prosecutors have determined this to be witness tampering.
If convicted, the Shasta County resident faces over two decades in prison. Prosecutors are also seeking forfeiture of all property Piercey derived from the scam.
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When FBI tried to arrest Matthew Piercey on Monday, he jumped on to pickup truck and led them on a wild chase that went off-road twice.
A former employee of defunct digital currency fund Bitsonar is now accusing the firm of engaging in deliberate fraud.
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