An appellate court has upheld the fraud conviction of Randall Crater, who founded cryptocurrency project My Big Coin and was sentenced to more than eight years in prison.
In a Feb. 23 filing for the United States Court of Appeals for the First Circuit, a three-judge panel affirmed Crater’s conviction more than a year after a jury found the crypto founder guilty of four counts of wire fraud, three counts of unlawful monetary transactions and one count of operating an unlicensed money-transmitting business. Appellate Judges Gustavo Gelpí, Jeffrey Howard and Julie Rikelman issued opinions arguing that Carter was not owed a new trial for participating in the crypto scheme.
Crater’s legal team argued that the court violated his Sixth Amendment rights by not enforcing subpoenas against witnesses he claimed would help his case, and including testimony from a crypto expert he argued was unqualified — Pamela Clegg, vice president of financial investigations at blockchain intelligence firm CipherTrace. According to the judges, no argument by Crater’s counsel “merits reversal.”
“CipherTrace’s investigation had revealed that MBC was not associated with a public blockchain and, therefore, lacked a crucial indicator of operating as a cryptocurrency until June 2017 -- long after Crater had marketed MBC as a virtual currency comparable to Bitcoin,” said the appellate filing.
Crater founded My Big Coin in 2013 and falsely marketed the firm as a crypto payment service, earning him roughly $7.6 billion in ill-gotten gains from 55 victims between 2014 and 2017. The founder also claimed the platform’s tokens were backed by gold, and the firm had partnered with Mastercard for a user credit card.
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The Justice Department filed criminal charges against Crater in February 2019. He was convicted in January 2023 and sentenced to 100 months in prison. He was also ordered to pay more than $7.6 million in restitution to victims — funds which, according to prosecutors, he used to purchase a home, cars and antiques.
U.S. authorities have pursued criminal charges against high-profile figures in the crypto space, including former Binance CEO Changpeng Zhao, former Celsius CEO Alex Mashinsky, and former FTX CEO Sam Bankman-Fried. Zhao pleaded guilty to one felony count and is scheduled to be sentenced in April. A jury convicted Bankman-Fried of seven counts in November, with sentencing scheduled for March 28. Mashinsky awaits trial in September.
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