The U.S. Securities and Exchange Commission (SEC) has halted a $62 million global cryptocurrency trading and mining scheme, and the Department of Justice (DOJ) has indicted its CEO and founder. If convicted on all counts, he faces up to 45 years in prison by the Justice Department.
SEC halts $62 million global cryptocurrency fraud scheme
The U.S. Securities and Exchange Commission (SEC) announced Friday that it has halted a fraudulent cryptocurrency mining and trading scheme.
The SEC charged MCC International (aka Mining Capital Coin), its founders (Luiz Carlos Capuci Jr. and Emerson Souza Pires), and two entities they control. The agency noted that the allegations “relate to unregistered products and the fraudulent sale of investment schemes known as mining packages to thousands of investors.”
The securities regulator detailed that, since at least January 2018:
MCC, Capuci and Pires sold mining packages to 65,535 investors around the world and promised to pay 1% daily returns per week for a maximum term of 52 weeks.
The complaint also alleges that MCC investors were initially promised returns in Bitcoin (BTC). However, the defendants later “requested investors to withdraw their investment in a token called Capital Currency (CPTL), which is MCC’s own token.”
DOJ charges MCC founder and CEO
The U.S. Department of Justice (DOJ) also independently announced Friday that Capuci, the alleged founder and CEO of cryptocurrency mining and investment platform MCC, has been charged with participating in a $62 million global cryptocurrency fraud scheme.
The U.S. Department of Justice alleges that Capuci, of Port St. Lucie, Florida, misled investors about its plans to mine and invest in the platform’s cryptocurrency by enticing them to invest in MCC’s “mining package.” He and his co-conspirators claim that MCC has an international network of cryptocurrency miners that can generate “significant profits and guaranteed returns” for investors.
The DOJ added that they also touted MCC’s own cryptocurrency as a so-called decentralized autonomous organization “stabilized by the revenues of the world’s largest cryptocurrency mining operation,” stating:
However, Capuci ran a fraudulent investment scheme and instead of using investors’ funds to mine new cryptocurrencies as promised, he transferred the funds to cryptocurrency wallets he controlled.
The indictment further alleges that Capuci touted and fraudulently marketed what MCC called “trading bots” as an additional investment mechanism to help investors profit in the cryptocurrency market.
The MCC founder also allegedly recruited promoters and affiliates to promote MCC in pyramid schemes, the DOJ said, adding that he laundered money through various foreign cryptocurrency exchanges, further concealing the location and control of the fraudulent proceeds. The Justice Department added:
Capuci is charged with conspiracy to commit wire fraud, conspiracy to commit securities fraud and conspiracy to commit international money laundering. If convicted on all counts, he faces up to 45 years in prison.
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