Post by anenro on Jul 13, 2020 16:53:52 GMT 4
Pennsylvania man with phony BTC holdings pleads guilty to bank fraud
A Pennsylvania man has pleaded guilty to bank fraud charges, after using fraudulent digital currency trading statements to secure a loan of over half a million dollars.
23-year-old Randall Joseph Smail admitted to the U.S. District Court for the Northern District of West Virginia that he had used a fake account statement from digital currency exchange Kraken to back the loan of over $552,000 from Pendleton Community Bank.
According to reports, Smail told the bank that the $640,000 showing in his digital currency balance could only be withdrawn in $200,000 increments. The funds were to front the money, which Smail would repay after withdrawal.
However, his statements to the bank were found to be false, with Smail in fact holding no BTC with the exchange.
According to the U.S. Department of Justice, there were discrepancies between the amounts of BTC claimed by Smail at various points during the deception.
“Smail defrauded Pendleton Community Bank of approximately $552,533. Smail created a fictitious account statement from Kraken Bitcoin Exchange, showing he had $640,000,000 in [BTC] that he produced when applying for a loan from the bank, knowing he did not own any [BTC] currency. He also produced other fictitious paperwork, showing $10,000,000 in another bank that he transferred from his cryptocurrency account, all of which he knew was false. He used these false documents to defraud the bank.”
Comment from ANENRO: IF Smail had access to such amount in Bitcoins, why did he need a loan? Makes no sense!
Smail was paid some $1,800 of the loan amount before the fraud was identified. As a result, he now faces fines of up to $1 million, as well as a maximum of 30 years in prison for the bank fraud.
The case is the latest example of fraud involving BTC, an increasing problem for prosecutors worldwide.
A Pennsylvania man has pleaded guilty to bank fraud charges, after using fraudulent digital currency trading statements to secure a loan of over half a million dollars.
23-year-old Randall Joseph Smail admitted to the U.S. District Court for the Northern District of West Virginia that he had used a fake account statement from digital currency exchange Kraken to back the loan of over $552,000 from Pendleton Community Bank.
According to reports, Smail told the bank that the $640,000 showing in his digital currency balance could only be withdrawn in $200,000 increments. The funds were to front the money, which Smail would repay after withdrawal.
However, his statements to the bank were found to be false, with Smail in fact holding no BTC with the exchange.
According to the U.S. Department of Justice, there were discrepancies between the amounts of BTC claimed by Smail at various points during the deception.
“Smail defrauded Pendleton Community Bank of approximately $552,533. Smail created a fictitious account statement from Kraken Bitcoin Exchange, showing he had $640,000,000 in [BTC] that he produced when applying for a loan from the bank, knowing he did not own any [BTC] currency. He also produced other fictitious paperwork, showing $10,000,000 in another bank that he transferred from his cryptocurrency account, all of which he knew was false. He used these false documents to defraud the bank.”
Comment from ANENRO: IF Smail had access to such amount in Bitcoins, why did he need a loan? Makes no sense!
Smail was paid some $1,800 of the loan amount before the fraud was identified. As a result, he now faces fines of up to $1 million, as well as a maximum of 30 years in prison for the bank fraud.
The case is the latest example of fraud involving BTC, an increasing problem for prosecutors worldwide.