Former Spokane resident indicted by grand jury for cryptocurrency investment fraud | Local
SPOKANE – Friday, October 13, 2023, Vanessa R. Waldref, the U.S. Attorney for the Eastern District of Washington, announced that a grand jury has returned an indictment against Michael Joseph McElhiney, 37, formerly of Spokane, Washington, on thirty- Three counts of fraud related to the conduct of a cryptocurrency investment scam that defrauded investors of more than $350,000 between March 2021 and September 2022.
The indictment alleges that McElhiney defrauded investors by pretending to operate a cryptocurrency investment fund called MAC Blockchain Solutions. The indictment alleges that McElhiney promised potential investors that he and his alleged business partners ran a successful cryptocurrency investment fund that invested in emerging cryptocurrencies and other blockchain-based projects, such as: B. Ethereum staking and cryptocurrency liquidity pools. According to the indictment, McElhiney promised that he would invest funds provided by investors and manage those investments for the benefit of his clients. McElhiney promised guaranteed or variable returns depending on the supposed investment vehicle and always promised investors that they could liquidate their investments at any time and get their money back. McElhiney then sent investors information through a platform called Coin.FYI, which was supposed to track the progress of their investments. In fact, the indictment alleges that McElhiney never invested the funds provided by investors, but instead kept the funds for his personal use, and that the alleged Coin.FYI accounts that McElhiney showed investors were not actual mutual funds, but were falsified figures designed to convince investors that McElhiney had invested their funds and that the investments were increasing in value. The indictment alleges that McElhiney defrauded investors of more than $350,000, including not only cash but also rare art and precious metals.
“Cryptocurrency fraud is a new twist on the same old song and dance of investment fraud,” said U.S. Attorney Waldref. “Whether it is cryptocurrency scams, multi-tier pyramid scams, real estate scams, old-fashioned Ponzi schemes, or other investment fraud vehicles, we will work closely with our law enforcement partners to hold fraudsters accountable when they exploit innocent members of the community to line their own pockets. “
The fraud charges carry maximum penalties of up to 30 years in federal prison. This case was investigated by the Department of Homeland Security, Homeland Security Investigations, the Spokane Resident Agency and the Spokane Police Department. Assistant United States Attorneys Dan Fruchter and Tyler Tornabene are prosecuting the case on behalf of the United States.
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