A New York jury returned a guilty verdict on two promoters of IcomTech, painted as a cryptocurrency mining and trading company that promised "victim-investors" that they would reap profits after purchasing purported crypto-related investment products.
Last week, U.S. Attorney for the Southern District of New York Damian Williams announced that promoters David Brend and Gustavo Rodriguez were "swiftly" convicted by a jury on charges of conspiracy to commit wire fraud in connection with their involvement in a "large-scale cryptocurrency Ponzi scheme known as IcomTech." The news was reported by cryptocurrency outlets Sunday.
"IcomTech defrauded tens of thousands of people out of tens of millions of dollars. It offered the false promise of easy riches based on supposed cryptocurrency investments but wound up cheating work people out of their hard-earned money," Williams said, as per a release from the Department of Justice (DOJ).
Williams described Brend and Rodriguez as "central to the IcomTech Ponzi scheme." Brend, in particular, was among IcomTech promoters who traveled across the country to host "lavish expos" and small community presentations that aimed to lure victims into the scheme. Some victims purchased crypto-related products from promoters using cash, actual cryptocurrencies, checks, and wire transfers.
While "most" of the victim-investors were unable to withdraw their so-called profits from the 2018-founded fake company, Brend and other promoters "siphoned off, in some cases, hundreds of thousands of dollars in victim funds," the DOJ said.
Despite complaints from investors that they couldn't withdraw their profits, IcomTech promoters continued to promote the company and even began offering crypto tokens called "Icoms." The promoters said Icoms would eventually be worth lots of money, but in reality, the tokens "were essentially worthless and resulted in further financial loss to victims," as per the DOJ.
Brend and Rodriguez are each faced with a maximum sentence of 20 years behind bars. The IcomTech promoters are due for sentencing later in June.
The DOJ indicted Brend, Rodriguez, and several other IcomTech promoters in mid-December 2022. At the time, Williams said the Attorney's Office was "sending a message to all cryptocurrency scammers: We are coming for you. Stealing is stealing, even when dressed up in the jargon of cryptocurrency."
In unsealed indictment documents, it was revealed that the fake crypto company's promoters showed up at promotion events wearing luxury clothing and expensive cars, boasting about the money they were making from the company. Most victims were allegedly Spanish speakers.
