The United States Department of Justice (DOJ) indicted the founder of “AML Bitcoin” on charges of money laundering and wire fraud. The U.S. Securities and Exchange Commission (SEC) also filed charges, alleging that the AML Bitcoin team violated federal securities laws.
According to a court filing dated June 22, Texas resident Rowland Marcus Andrade, the founder of the NAC Foundation, allegedly raised funds by making an initial coin offering for tokens representing AML Bitcoin, and told investors that the tokens would eventually be converted to real bitcoin AML (which is not real bitcoin). The SEC and DOJ also indicted DC lobbyist Jack Abramoff for conspiracy, disclosure lobbying, and deceptive practices, alleging that he helped mislead investors in the project.
Andrade told CoinDesk on Thursday night that he was not guilty of the charges, alleging that the accusations were “retaliation” for his opposition to a previous case.
According to Bloomberg, Abramoff will plead guilty and pay more than $ 50,000 in return and interest.
“In [its] White Paper, The NAC Foundation claimed that the AML Bitcoin cryptocurrency would include features that would allow the cryptocurrency to comply with anti-money laundering regulations and laws (also known as ‘AML’) and to know its customer (‘KYC’) by using “biometric technologies” among other methods to confirm the identities of the participants in transactions that use Bitcoin AML, “said the Justice Department filing.
According to a 2018 press release, the NAC Foundation claimed that AML Bitcoin was “the world’s only patent-pending digital currency with anti-money laundering, know-your-customer, anti-terror and theft-resistant properties.”
The Justice Department presentation was first shared by Seamus Hughes, deputy director of George Washington University, Extremism Program.
Andrade attempted to raise up to $ 100 million during the ICO, which occurred in late 2017 and early 2018, according to the filing. According to the SEC complaint, Andrade raised about $ 5.6 million from 2,400 investors.
According to the Justice Department filing, Andrade and his unidentified colleagues “made public statements and statements to potential buyers” who “misrepresented the state of development” of the project, created a false “rejection campaign”, made statements indicating that the Foundation NAC was close to working with government agencies and “misappropriated money obtained through the sale of AML Bitcoin”.
The false rejection campaign focused on the National Soccer League, according to the DOJ presentation.
“Andrade, the NAC Foundation and their associates claimed that the ad would have been broadcast during the Super Bowl if the television network broadcasting the Super Bowl and the National Football League had not rejected the ad as being too controversial,” the filing alleged. “In fact, the NAC Foundation did not have the funds to purchase the advertising time, and the ad was never reviewed or rejected by the network or the NFL.”
According to the Justice Department, Andrade also claimed to have substantive meetings with the Panamanian government and an elected official in California. The presentation alleged that Panama’s claims were “exaggerated”, and while “Andrade was present at a round table and took his photograph with the [California] official, “AML Bitcoin” was not discussed. ”
About $ 1 million was spent on a new house and real estate, the Justice Department filing alleged.
According to a March filing, US officials have also asked to confiscate “a parcel of real property” owned by Andrade and his wife, at least in part.
This presentation details how Andrade allegedly convinced an individual, named “VICTIM ONE,” to invest $ 1 million in the AML Bitcoin project, but transferred the funds to a JPMorgan Chase account held by “JD”, an Andrade associate. The funds were allegedly transferred to a third party “who acted under Andrade’s direction” at JPMorgan; then to an account that belongs to “NAC Payroll Services Inc.”; then to a Wells Fargo account owned by Andrade; then to a personal account at Woodforest National Bank.
The March filing alleges that these funds were used to purchase a residence from a Texas home construction company.
“To date, Andrade and the NAC have not made any significant progress toward the development of AtenCoin, AML Bitcoin, or ABTC,” the filing said, referring to two other names affiliated with AML Bitcoin.
This case is ongoing, according to court records.
UPDATE (June 26, 2020 02:55 UTC): This article has been updated with additional charges by the United States Securities and Exchange Commission and comments by Rowland Marcus Andrade.
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