A New York jury convicted two former promoters of the alleged cryptocurrency mining and trading company IcomTech, both now subject to a maximum sentence of 20 years in prison for their involvement in the “Ponzi” scheme.
The two-week trial concluded on March 14 when a jury in a New York District Court found Gustavo Rodriguez and David Brend each guilty of one count of conspiracy to commit wire fraud.
According to a March 15 press release from the U.S. Attorney’s Office for the Southern District of New York, IcomTech founder David Carmona engaged Rodriguez in mid-2018 to create a website for the newly launched IctomTech, which advertised itself as a cryptocurrency trading and mining firm.
Carmona, Brend, and others purportedly assured ItomTech investors of daily returns on their cryptocurrency mining and trading investments.
As opposed to trading or mining cryptocurrencies, prosecutors assert that the organization operated as a “Ponzi” scheme in which investor funds were used to reimburse other investors.
Additionally, Rodriguez guided the cost of “investment packages” and simulated daily returns accessible to investors via his website and a portal.
The U.S. Attorney’s Office stated that Brend and the other promoters of the scheme “siphoned off, in some cases, hundreds of thousands of dollars in victim funds.”
To entice more investors with the promise of “financial freedom,” the stolen funds were used to purchase real estate, travel, and host “lavish expos and small community presentations,” where promoters appeared in “luxurious cars and wore luxury clothing.”
Aside from “excuses, delays, and hidden fees,” IcomTech investors could not withdraw their fictitious profits despite witnessing them increase on the portal.
In response to mounting complaints, IcomTech introduced a token known as “Icoms” with the deceptive promise of securing corporate payments. This initiative aimed to generate additional funds.
Icoms were “virtually worthless” and contributed to additional losses when IcomTech ceased making payments in 2019 and subsequently failed.
According to Damian Williams, the United States Attorney for the Southern District of New York, the scheme “squandered the hard-earned money of working people” and “defrauded tens of thousands of individuals of tens of millions of dollars.”
He added, “Brennd and Rodriguez stand convicted of a federal crime and face substantial time in prison as a result of the lies they told hardworking individuals.”
Brend is slated to receive his sentence on June 27, and Rodriguez is scheduled to do the same on June 28.
In January, former IcomTech CEO Marco Ochoa received a five-year sentence after his guilty plea for conspiracy to commit wire fraud. The organization’s founder Carmona also entered a guilty plea for conspiracy to commit wire fraud in December.
