Business

Steve Kaaru

NY Attorney convicts British citizen for BTC-related fraud

The U.S. Department of Justice (DOJ) has announced the conviction of a British citizen in connection with a fraudulent SegWitCoin (BTC) related venture. The man, James Moore, was convicted of wire fraud and conspiracy for his role in covering up the identity of a known crypto scammer with whom they operated a business together.

According to a press release by the U.S. Attorney for the Southern District of New York Geoffrey Berman, Moore was found guilty after a one-week trial.

From 2015 to 2016, Moore partnered with Renwick Haddow in soliciting investments for workspace leases under a venture called Bar Works. Haddow, another British citizen, had been disqualified in the U.K. from being the director of any company. The Financial Conduct Authority, the country’s financial watchdog, was also after him for defrauding investors in a BTC scam.

Known as Bitcoin Works Inc., the scam company advertised itself as simple and intuitive platform for securely trading and storing crypto. It claimed to have grossed over $7 million.

Fully aware that Haddow didn’t qualify to run a business venture in the U.S., Moore and others conspired to conceal his role at Bar Works. Haddow adopted ‘Jonathan Black’ as his alias. Thereafter, Moore and the others distributed materials that claimed Black was the CEO of Bar Works and that he had an extensive background in finance and startup companies. The press release stated:

“Among other things, MOORE helped devise pitch materials that contained the misrepresentation, coordinated a substantial sales force to recruit investors knowing that the materials contained the falsehood, advised Haddow as to how to continue to conceal the truth concerning the identity of ‘Jonathan Black,’ and affirmatively represented to agents for investors that he was communicating with CEO ‘Jonathan Black.’”

Moore reportedly received over $1.6 million for his efforts.

Berman also announced that he had unsealed Haddow’s guilty plea on May 8, in which he “admitted to his own involvement in the fraudulent scheme related to Bar Works, as well as to making material misrepresentations and misappropriating investment funds in another company created by Haddow called Bitcoin Store Inc.”

Haddow had also been charged with fraud by the U.S. Securities and Exchanges Commission (SEC) in 2017 for failing to register Bitcoin Store with the regulator as well as for defrauding investors. According to a press release by the watchdog, Haddow allegedly diverted 80% of the funds collected by Bitcoin Stores into personal accounts in Mauritius and Morocco. He also sent over $4 million from the Bar Works accounts into his personal accounts.

Note: Tokens on the Bitcoin Core (SegWit) chain are referenced as SegWitCoin BTC coins. Altcoins, which value privacy, anonymity, and distance from government intervention, are referenced as dark coins.

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