Texas man in $20M Meta-1 Coin fraud sentenced to 23 years in prison

Meta-1 Coin was sold and marketed from 2018 to 2023 as an investment backed by $44 billion in gold and $1 billion in artworks, which turned out to be fictional.

A Texas man found guilty of helping orchestrate a cryptocurrency scam project that defrauded $20 million from nearly 1,000 investors has been sentenced to 23 years behind bars by a US judge on Tuesday.

US District Judge LaShonda Hunt sentenced Robert Dunlap, who served as a trustee of the project that sold the fictional token Meta-1 Coin, to prison and ordered him to pay restitution to victims of the fraud, according to the Illinois US Attorney's office.

Assistant US attorneys Jared Hasten and Paige Nutini said in the government’s sentencing memorandum that Dunlap was “unrepentant” and that his lies grew “over the years.”

“Would-be criminals planning to engage in similar conduct need to know that such actions will be met with a serious repercussion that includes loss of one’s liberty for an extended period of time,” they added.

Regulators and authorities are turning up the heat on crypto scammers. In March, a man accused of hacking defunct DeFi platform Uranium Finance was charged with one count of computer fraud and one count of money laundering.

A federal jury in the Northern District of Illinois convicted Dunlap in November on two counts of mail fraud, each carrying a possible sentence of up to 20 years in federal prison.

He was accused of conspiring with others to market and sell Meta-1 Coin through a Meta-1 Coin Trust from 2018 to 2023, making false and misleading statements to investors, including that the token was backed by a $1 billion art collection made up of works by Pablo Picasso and Vincent van Gogh and $44 billion in gold.

Related: There’s more to crypto crime than meets the eye: What you need to know

Dunlap and his co-conspirators used automated trading bots to artificially inflate the market price and trading volume of the Meta-1 Coin on the Meta Exchange, a website Dunlap created, according to authorities.

In March 2020, the US Securities and Exchange Commission (SEC) ordered an asset freeze and other emergency relief orders to stop Dunlap, another alleged accomplice, Nicole Bowdler and former Washington state Senator David Schmidt from marketing and selling Meta-1 Coin.

The defendants allegedly told investors that Meta-1 Coin was risk-free and could offer returns of up to 224,923%. Instead, the coins were never distributed and the funds were used to cover personal expenses and buy luxury cars, including a Ferrari, according to the SEC.

Magazine: Forget stablecoin yield, how does the CLARITY Act treat DeFi? 

Source: CoinTelegraph