DOJ Files Charges Against Two Men in $25 Million Crypto Scam
The U.S. Department of Justice (DOJ) has taken legal action against two individuals for orchestrating a fraudulent cryptocurrency Ponzi scheme that resulted in the theft of over $25 million. According to court documents, David Gilbert Saffron from Australia and Vincent Anthony Mazzotta Jr. from Los Angeles deceived victims by promising lucrative returns through AI trading software. Instead of investing the funds as promised, the defendants indulged themselves in luxurious personal expenses such as private jets, mansion rentals, and expensive hotels.
The charges against Saffron and Mazzotta include conspiracy to commit wire fraud, wire fraud, conspiracy to obstruct justice, conspiracy to commit money laundering, and money laundering. If convicted, they could each face a maximum of 55 years in prison, with an additional 10 years for Saffron due to committing felonies while on pre-trial release.
The accused fraudsters operated under various names, including Circle Society, Bitcoin Wealth Management, Omicron Trust, Mind Capital, and Cloud9Capital, to market their program. They would then direct victims to pay a fictional organization called the “Federal Crypto Reserve” to supposedly investigate and recover their losses.
Saffron went to great lengths to conceal his true identity, using aliases and online personas like “Blue Wizard” and “Bitcoin Yoda” to solicit funds. Additionally, the defendants attempted to cover their tracks by falsifying records, destroying documents, and employing techniques like “mixing” and “blockchain hopping” to obscure victims’ crypto assets.
This case bears resemblance to the elaborate scam conducted by Canada’s notorious “crypto king,” who managed to swindle $40 million from investors. Similarly, he spent a significant portion of the funds on luxury items, such as private jets and sports cars. In a twist of fate, the crypto king was kidnapped for three days while his captors demanded a ransom.
The DOJ’s recent actions reflect its ongoing efforts to crack down on crypto-related fraud. In a separate case, a Miami crew leader was sentenced to 63 months for stealing $4 million from a cryptocurrency exchange using fake identities and bank fraud. Furthermore, Binance, one of the largest crypto exchanges in the world, was fined a record $4 billion by the DOJ for failing to comply with anti-money laundering regulations.