US authorities on Tuesday filed criminal charges against a cryptocurrency executive and civil charges against him and his sister, accusing them of defrauding retail investors out of millions of dollars with a digital token known as Ormeus Coin.<\/p>\n
In papers filed in Manhattan federal court, the justice department said John Barksdale lied about the value and profitability of Ormeus Coins mining assets, including that the coin was backed by a $250m mining operation generating more than $5m of monthly revenue.<\/p>\n
Barksdale and his sister JonAtina (AKA Tina) Barksdale were separately charged by the Securities and Exchange Commission with conducting fraudulent unregistered offerings of Ormeus Coin.<\/p>\n
The SEC said the Barksdales since 2017 raised $124m from more than 20,000 investors through their multi-level marketing company Ormeus Global SA, and spent millions of dollars on travel, real estate and other personal expenses.<\/p>\n
Authorities said the siblings promoted Ormeus Coin through roadshows and social media, as well as a Times Square jumbotron in Manhattan proclaiming: $250 Million Cryptocurrency Mining Farm Revealed in Legal Audit by Ormeus Coin.<\/p>\n
The Barksdales acted as modern-day snake-oil salesmen in misleading investors, Melissa Hodgman, associate director of the SEC enforcement division, said in a statement.<\/p>\n
Lawyers for the Barksdales could not immediately be identified.<\/p>\n
John Barksdale has been arrested, and faces up to 65 years in prison on securities fraud, wire fraud and conspiracy charges, according to the justice department.<\/p>\n
Both defendants are US citizens, with John Barksdale, 41, having lived in Thailand and JonAtina Barksdale, 45, in Hong Kong, the SEC said.<\/p>\n
The SEC chair, Gary Gensler, has called the cryptocurrency industry the wild west of finance and wants cryptocurrency exchanges to register with the SEC.<\/p>\n
The White House has been considering broad oversight over the cryptocurrency market, in part to address ransomware and other cybercrime.<\/p>\n
Joe Biden is expected this week to direct the justice department and other federal agencies to study possible ramifications from creating a US central bank digital currency, a person familiar with the matter said.<\/p>\n
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\nBrother and sister charged with cryptocurrency fraud in New York - The Guardian<\/a><\/p>\n","protected":false},"excerpt":{"rendered":"