APRIL 25: In this photo illustration of the litecoin, ripple and ethereum <a href="https://cryptoz7.com/prediction-1-cryptocurrency-that-will-be-worth-more-than-bitcoin-and-ethereum-combined/” title=”Prediction: 1 Cryptocurrency That Will Be Worth More Than Bitcoin and Ethereum Combined”>cryptocurrency ‘altcoins’ sit arranged for a photograph on April 25, 2018 in London, England. (Photo by Jack Taylor/
LAS VEGAS (KSNV) —A federal jury on Monday convicted a Las Vegas businessman on charges that he used a cryptocurrency Ponzi scheme to fraudulently obtain $24 million.
The U.S. Attorney’s Office for Nevada said that after a nine-day trial, Brent Kovar was found guilty on 11 counts of wire fraud, two counts of mail fraud and two counts of money laundering.
Prosecutors said Kovar owned a Las Vegas-based company called Profit Connect from 2017 to 2021. The company purportedly used artificial intelligence software on a supercomputer to mine cryptocurrency and verify other transactions.
Kovar falsely claimed the company was profitable and would pay investors a fixed rate of return between 15% and 30%, prosecutors alleged. He also falsely claimed the company was backed by hundreds of millions of dollars in crypto reserves.
However, Kovar allegedly knew he could not pay the fixed rates of return and instead used investor money to operate Profit Connect, buy gifts for employees, buy a house for himself and repay investors as if the money came from his company’s operations.
Prosecutors alleged Kovar obtained a total of $24 million from at least 400 investors.
“The victims in this case thought they were engaged in revolutionary technological advancement, but it was merely a deception crafted by the falsehoods and trickery of Mr. Kovar,” Special Agent in Charge Christopher S. Delzotto for the FBI Las Vegas Field Office said in a statement.
Kovar faces up to 280 years in federal prison. Sentencing is scheduled for Nov. 30.
Delzotto urged anyone who might have been a victim of fraud or knows a victim to submit a complaint to the FBI’s Internet Crime Complaint Center at ic3.gov.
