Former Deutsche Bank and JPMorgan employee arrested for crypto fraud
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The crypto industry has seen a number of former bankers, brokers, and other individuals from the traditional financial industry switch to digital assets. Many have come after recognizing the potential of cryptocurrencies to resist different financial situations, such as the stock price crash in early 2020, which followed the start of the COVID-19 pandemic.
However, some who switched to crypto clearly had the idea of using it to scam people, which seems to be the case with the registered broker, Rashawn Russell, 27, who previously worked for Deutsche Bank and JPMorgan. The young investment banker was arrested this Monday, April 10th, for allegedly committing crypto fraud. According to the US Justice Department, he was arraigned in a New York court yesterday.
Russell claimed that he was running a crypto fund
Russell was charged with conning multiple crypto investors, promising major returns for their investments into various altcoins — a term used to describe cryptocurrencies that are not Bitcoin. He promised that he would invest on their behalf, guaranteeing that the investors would see major profits in return. However, after they handed over the money, he supposedly used it to pay back other investors and thus prolong the scheme, gambling, and other forms of personal gain.
The indictment claims that he convinced investors, including friends and colleagues, that he is a licensed broker who worked in investment banking. He also claimed that he ran a cryptocurrency fund R3, which guaranteed high returns on investments, only to proceed to misappropriate the funds granted to him by the people he sought to trick.
The Justice Department further claimed that Russell even faked documents that indicated that he was highly successful at turning a profit from altcoin investments, which undoubtedly helped convince people that giving him money was a good idea.
Russell is facing up to 20 years in prison if found guilty
The US Attorney’s Office, Eastern District of New York indictment says, “At times, he also claimed he had developed a successful strategy to trade ‘altcoin’ cryptocurrencies and earned returns for investors in excess of 100% over previous three-month periods.”
“As alleged, Russell turned the demand for cryptocurrency investments into a scheme to defraud numerous investors in order to fund his lifestyle,” stated United States Attorney Peace. https://t.co/UAASdEB0WO
— US Attorney EDNY (@EDNYnews) April 11, 2023
US Attorney for the Eastern District of New York, Breon Peace, added that Russell turned the rising demand for crypto investment into a scheme to defraud numerous people and fund his own lifestyle. Peace further noted that his Office would continue to pursue similar fraudsters perpetrating these schemes against digital asset investors
“This Office will continue to aggressively pursue fraudsters perpetrating these schemes against investors in the digital asset markets.” – U.S. Attorney Peace
— US Attorney EDNY (@EDNYnews) April 11, 2023
According to Russell’s LinkedIn page, he allegedly worked for both Deutsche Bank and JPMorgan and Moody’s. However, due to his fraudulent actions involving cryptocurrencies and targeting unsuspecting investors, he is now facing a maximum punishment of 20 years in prison, if the court finds him guilty, according to the announcement.
