A Florida man pleaded guilty in federal district court on Thursday to participating in a cryptocurrency-based Ponzi scheme that defrauded investors of approximately $100 million, the Department of Justice announced today.
The department says Joshua David Nicholas of Stuart, Florida—population 16,000—acted for nearly two years as the so-called “head trader” of EmpiresX, a cryptocurrency investment platform that promised investors daily profits of one percent thanks to the combined abilities of a state-of-the-art “trading bot” and Nicholas’ manual trading acumen.
In reality, the bot did not exist.
Nicholas, along with EmpiresX co-founders Emerson Sousa Pires and Flavio Mendes Goncalves, took the majority of investors’ funds and leased a Lamborghini, bought numerous items from Tiffany & Co., and made payments on a second home.
According to the Justice Department, the small amount of users’ funds that Nicholas did trade in the cryptocurrency market incurred substantial losses.
Nicholas today pleaded guilty to one count of conspiracy to commit securities fraud, and faces up to five years in federal prison. Nicholas was also originally charged in June with conspiracy to commit wire fraud, although that charge appears to have since been dropped.
Pires and Goncalves, meanwhile, fled to their native country of Brazil after freezing investor withdrawals earlier this year. They were both nonetheless charged in June with securities fraud and wire fraud, as well…
