The founder of the Gemcoin cryptocurrency scheme, Stephen Chen, will spend ten years in jail for defrauding tens of thousands of investors and evading taxes.
In February last year, the initiator of the Gemcoin scheme agreed to plead guilty to tax evasion and electronic fraud. The multi-tiered marketing scheme attracted 70,000 victims worldwide in two years, and the total losses for investors exceeded $ 147 million.
In his plea, Chen reported $ 138,000 in revenue in 2014, far less than the $ 4.8 million he actually received. In addition to serving a ten-year jail sentence, Chen has to pay the IRS $ 1.8 million in tax arrears.
Chen has been sentenced, but his case is still pending. The judge has scheduled a damages hearing for July to discuss payments to investors affected by Chen’s fraudulent scheme.
Gemcoin’s founders were arrested back in 2015. The US Fine Investment Arts (USFIA) company from 2013 to 2015 sold the Gemcoin cryptocurrency to investors, allegedly backed by precious stones that did not actually exist.
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