A Texas man found guilty of helping organize a cryptocurrency scam that defrauded nearly 1,000 investors of $20 million was sentenced by a U.S. judge on Tuesday to 23 years in prison.
U.S. District Judge LaShonda Hunt sentenced Robert Dunlap, who was a trustee of the project selling the fictional Meta-1 Coin token, to prison and ordered him to pay restitution to victims of the fraud, According to to the Illinois State Attorney’s Office.
Assistant U.S. attorneys Jared Hasten and Paige Nutini said in the government’s sentencing memorandum that Dunlap “showed no remorse” and that his lies increased “over the years.”
“Future criminals planning similar conduct must know that such actions will be met with serious consequences, including loss of freedom for a longer period,” they added.
Regulators and authorities are stepping up their focus on cryptocurrency scammers. In March, a man accused of hacking into the now-defunct DeFi platform Uranium Finance was charged with one count of computer fraud and one count of money laundering.
Token backed by $44 billion in gold and infrequent works of art
Federal grand jury in the Northern District of Illinois convicted Dunlap in November on two counts of mail fraud, each of which carries a sentence of up to 20 years in federal prison.
He was accused of conspiring with others to promote and sell Meta-1 Coin through the Meta-1 Coin Trust between 2018 and 2023, making false and misleading representations to investors, including that the token was backed by a $1 billion art collection consisting of works by Pablo Picasso and Vincent van Gogh and $44 billion in gold.
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According to authorities, Dunlap and his co-conspirators used automated trading bots to artificially inflate the market price and trading volume of the Meta-1 coin on Meta Exchange, a website created by Dunlap.
In March 2020, the U.S. Securities and Exchange Commission (SEC) ordered asset freezes and other emergency relief orders aimed at stopping Dunlap, another alleged accomplice, Nicole Bowdler, and former Washington State Senator David Schmidt, from marketing and selling the Meta-1 coin.
The defendants allegedly told investors that Meta-1 Coin was risk-free and could offer returns of up to 224.923%. Instead, according to the SEC, the coins were never distributed and the funds raised were used to pay personal expenses and purchase luxury cars, including a Ferrari.
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