The former Deutsche investment banker was sentenced to more than three years in prison for running a cryptocurrency-related Ponzi scheme.
Following a trial in the Brooklyn Federal Court, the U.S. Department of Justice has handed down a 41-month prison sentence to 28-year-old Rashawn Russell, a Brooklyn resident. Russell, who had previously pleaded guilty to the charges in September, will now face the consequences of his actions.
Investors Lose $1.5 Million in Russell’s Fraud.
Russell was formerly a registered broker with the Financial Industry Regulatory Authority (FINRA) and has gained trust with such a reputation. However, he failed to live up to expectations as he mishandled funds entrusted to him.
Russell falsely promised his friends, colleagues, and family members a 25% return on investment within three months. He promised to use their funds in acquiring and trading cryptocurrencies that will yield massive profits within a limited period.
For 21 months, between November 2020 and August 2022, Russell used the deposited funds to satisfy personal interests. Instead of acquiring cryptos, as stated, he used his investors’ funds to gamble. Moreover, Russell used some investors’ funds to repay others.
He didn’t provide the investors with the agreed-upon returns. After some investors decided to abandon the scheme and withdraw their investments, he falsely claimed to have transferred the money to them.
As a result of Russell’s fraudulent activities, investors have collectively lost a staggering $1.5 million, a devastating blow to their financial security and trust in the cryptocurrency market.
According to prosecutors, Russell operated on another unscrupulous scheme between September 2021 and June 2023. He falsely obtained almost 100 credit/debit cards and 43 different identity cards belonging to other citizens of New York, purposing to use their credentials to create gambling accounts and process unwarranted transactions.
Court Reacts to Russell’s Fraud
After prosecutors accused Russell of fraudulence in February, he was sentenced to eight months in prison. Three months later, the authorities canceled his bail as the court wanted to serve him fitting justice for the charged offense, just as in the case of others charged with and found guilty of crypto-related fraud.
United States District Judge Hector Gonzalez has sentenced Rashawn Russell to 41 months in prison for cryptocurrency fraud and access device fraud scheme.
Concerning the charges against him, Russell said that he is “deeply remorseful for creating victims out of many of my closest friends and acquaintances,” whose money he squandered to fund a “crippling” gambling and substance abuse addiction.