A US district judge has sentenced a man to three years in prison for a fraudulent cryptocurrency mining scheme. The defendant “misappropriated money from his victims and failed to provide them with the miners and miner hosting services they had purchased from him,” according to the US Department of Justice (DOJ).
Man Sentenced to Prison for Defrauding Investors in Crypto Mining Scheme
The US Department of Justice (DOJ) announced Thursday that Chester (Chet) Stojanovich was sentenced to three years in prison “for defrauding buyers of cryptocurrency miners and miner hosting services.” He pleaded guilty in November of last year to one count of wire fraud.
The DOJ explained that from at least 2019 until his arrest in April 2022, Stojanovich “allegedly defrauded more than a dozen victims out of more than $2 million through fraudulent misrepresentations that he would provide his clients with specialized cryptocurrency mining computers ( ‘miners’) and miner hosting services that would provide victims with a lucrative stream of hash power convertible into cryptocurrency.” The Justice Department added:
Instead, Stojanovich misappropriated money from his victims and failed to provide them with the miners and miner hosting services they had purchased from him.
In addition to failing to provide buyers with the cryptocurrency mining equipment and hosting services they had purchased, the Justice Department said Stojanovich “employed deceptive practices to create the illusion that such miners had been purchased and were being used to provide hash power to those clients.”
In addition, Stojanovich allegedly “misappropriated his clients’ funds and spent the funds on personal and unrelated expenses, including chartered flights, hotel rooms, limousines, and private parties,” the Justice Department detailed. Noting that Stojanovich was sentenced Thursday before US District Judge Denise Cote, the Justice Department concluded:
In addition to his prison sentence, Stojanovich… was sentenced today to three years of supervised release, forfeiture of $2,158,927 and restitution to his victims in the amount of $2,108,927.
Do you think Stojanovich should go to prison for more than three years for defrauding investors in this crypto mining scheme? Let us know in the comments section.
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