Brenda Chunga, identified on-line as “Bitcoin Beautee,” was the American face of an Australian Ponzi scheme known as HyperFund.
Chunga made almost $4 million selling the scheme—which defrauded investors across the globe of $1.9 billion (pdf)—on social media, in accordance with the US Securities and Change Fee (SEC). Together with her fortune, she purchased a million-dollar home in her residence state of Maryland, a million-dollar condominium in Dubai, a BMW, and a few designer purses.
Nevertheless it all got here crashing down, and on Monday (Jan. 29), Chunga pled guilty to fraud in a federal courtroom in Maryland. HyperFund’s co-founder, Australian citizen Sam Lee, was additionally charged. One other American promoter, Miami resident Rodney Burton, aka “Bitcoin Rodney,” was arrested the identical day and is being detained. Chunga faces as much as 5 years in jail; Burton might serve 10.
“The extent of alleged fraud right here is staggering,” stated US legal professional Erek L. Barron this week in the announcement of the charges by the Division of Justice (DoJ). “Whether or not it’s cryptocurrency fraud, or some other monetary frauds, if it sounds too good to be true, it most likely is.”
The large crypto crackdown continues
Crypto schemes have been on the rise for the reason that pandemic, and HyperFund’s actions had been placed on blast by a Guardian Australia investigation on the finish of final 12 months. The costs in opposition to Chunga and Lee by the SEC and the DoJ, in addition to Burton’s arrest, sign that the American crackdown on crypto isn’t completed.
Final 12 months, federal regulators took motion in opposition to the most important cryptocurrency exchanges, Coinbase, FTX, and Binance, or their founders. In maybe essentially the most high-profile case, FTX founder Sam Bankman-Fried was convicted of stealing at least $10 billion from traders.
Different schemes had been additionally uncovered. A YouTuber was charged for defrauding traders of about $1 billion and utilizing it to purchase himself shiny issues like Rolex watches. Federal and state investigators probed the founder of cryptocurrency lender Celsius over fraud considerations.
Smaller-scale scams haven’t been spared. Most not too long ago (and surprisingly), a Colorado pastor of an online church was charged by the state’s Division of Securities for crypto fraud, after milking about $3 million from traders.
