Just recently the United States Justice Department apprehended one of the two crypto fraudsters accused of a shadow banks scheme that entailed the processing of over a hundred million dollars unregulated transactions on behalf of several crypto exchange platforms.
Tether and Bitfinex could be involved
According to rumours Bitfinex and Tether are among the crypto exchange platforms involved. The pair obtained a court order from the U.S Attorney for the Southern District New York that barred them from operating in the state. The shutdown is as a result of the $850 million lost through some questionable circumstances.
According to the U.S. Attorney General, “The operators of the Bitfinex trading platform, who also happen to control the ‘Tether’ virtual currency, have engaged in a cover-up to hide the apparent loss of $850 million dollars of co-mingled client and corporate funds. New York State has led the way in requiring virtual currency businesses to operate according to the law. And we will continue to stand-up for investors and seek justice on their behalf when misled or cheated by any of these companies.”
Israeli Scammer Nowhere to be Found
The scammer, Reginald Fowler from Arizona was arrested two days ago while is partner Ravid Yosef, from Israel is still on the loose. According to the charges pressed against, Fowler and Yosef, the two were lying to banks so as to open accounts which they later used to receive deposits from customers buying cryptocurrencies. The duo also used these bank accounts to falsify electronic wire payment instructions to hide the multi-million crypto exchange business.
Apparently, Fowler and Yosef began their fraudulent schemes way back in 2018. Fowler opened and maintained bank accounts at various banks across the globe. The two would tell one bank that one specific account would be used to process real estate investments. According to the indictment;
“One of the Crypto Companies marketed itself as a company that allows clients to deposit and withdraw government-backed, or “fiat,” currency to numerous crypto exchanges. Users of one particular crypto exchange deposited government-backed currency into a bank account of the Crypto Companies that was opened and maintained by Fowler at a specific international bank.’’
Fowler got charges on bank fraud and operating an unlicensed money transmitting business while Yosef got charges on bank fraud as Fowler’s co-conspirator. These charges were brought by the U.S. Attorney for the Southern District of New York.