The law comes again after cryptocurrency fraudsters were sentenced to three years in prison for stealing $1.9 million from buyers. “Investment management service” Dropil was found to have tricked its 2,000 clients into promising them access to trading bots, although it didn’t work as advertised.
The failed buyer invested in Dropil’s DROP token and promised a financial return of up to 63%. When pressured by regulators, project leaders falsified reports and lied under oath. They have now pleaded guilty to securities fraud and will serve five and a half years in prison.
Jeremy David McAlpine has been given a maximum sentence of 36 months in federal prison (thanks, Web3 is going well). Zachary Michael Matar was sentenced to 30 months in prison for his involvement in the project. Back in 2021, McAlpine and Matar pleaded guilty to securities fraud, admitting they lied to investors about what they would receive for buying DROP tokens.
Clients are promised “Dex” – a trading bot that can help them earn returns between 24% and 63%. An investigation by regulators found the figures were wrong.
At sentencing, prosecutors condemned the actions of McAlpine and Mattar. “They caused significant financial damage to a large number of victims,” commented the prosecutor. “[They] Efforts are needed to undermine law enforcement efforts to root out and address wrongdoing. “
McAlpine and Matar are far from the only crypto projects facing legal consequences. As we recently reported, the US is cracking down on Web3 scams, with one defendant facing 115 years in prison if found guilty. Another faces 40 years in prison for allegedly defrauding investors of $2.6 million.
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