- Telecommunications Giant Vodafone Leaves the Libra Association
- Group of Central Banks Assesses Developing Central Bank Digital Currencies
- South Korea Might Impose 20 Percent Tax on Cryptocurrency Profits
- Report: Terrorists Increasingly Use Crypto to Raise Funds Anonymously
- Canadian Securities Administrators Subject Crypto Exchanges to Securities Laws
Another case of unscrupulous fraudster managing to steal from unwary investors has emerged recently, this time in New York where a man who called himself “the Coyote of Wall Street” stole cash from clients who thought he would use their money to invest in cryptocurrencies.
Patrick McDonnell (or the Coyote of Wall Street), 46, from Staten Island and the owner and operator of CabbageTech Corp. pleaded guilty to wire fraud on June 21 in federal court in Brooklyn. McDonnell also confessed that he used social media postings to dupe investors and steal their money.
McDonnell confessed to U.S. District Judge Nicholas Garaufis:
“I perpetrated a fraud. I claimed to invest it in virtual currency and spent it on personal expenses.”
Through posts on the social media, McDonnell falsely claimed that he had traded more than $50 million in Bitcoin for thousands of clients and pretended to be an expert crypto trader and investor. He had also appeared in a YouTube video wearing a Guy Fawkes mask (usually used by Anonymous hackers) and talking about cryptocurrencies.
The prosecutors state that investors sent him money for crypto investment, but ‘[i]nstead, McDonnell pocketed his investors’ money, buying cryptocurrencies for himself and spending at least $194,000,’ all the while operating the CabbageTech scheme from his home. He pleaded guilty to one count of fraud involving one investor, and also admitted that he took more than $164,000 from that single person. As per U.S. District Judge Nicholas Garaufis, McDonnell will be sentenced to prison for a few years from September 10th.
Not McDonnell’s First Crypto Scam
It is not the first time that 46-year-old McDonnell has been accused of stealing money using various tricks and schemes. Previously, McDonnell was also one of the many crypto promotors who were engaged in fraudulent activities and was sued by regulators including the Commodity Futures Trading Commission (CFTC). In 2018, he was asked to pay $290,429 in restitution and additional $871,287 in penalties by a Brooklyn judge. According to the judge, McDonnell used trickery and lies to steal money from cryptocurrency investors.
Apparently, he didn’t learn his lesson from then, and now he will face the consequences of his continuous nefarious actions.
Unfortunately, the crypto sphere is full of similar cybercriminals who are engaged in Ponzi schemes, phishing, and other fraudulent activities through which they dupe unsuspecting investors and common people who are interested in cryptocurrency investments. Many crypto investors have lost millions of dollars by investing in such bogus schemes offered by fraudsters. The fraudster normally lures the investors in by promising them too-good-to-be-true returns for their investments made in cryptocurrencies. McDonnell is just another example for such crypto scams.