Bruce Bise and Samuel Mendez were first charged in August 2021. Bise pleaded guilty in September and was slapped with a 50 month federal prison sentence last week. Mendez pleaded guilty in October and was also sentenced to 50 month in prison.
The Department of Justice said in a press release that the owners admitted to raising around $24 million from more than 13,000 investors. They used that money on personal expenses like casino trips, cars, art and rent.
“Crypto actors are required to pay their fair share of taxes, just like everyone else,” U.S. Attorney Chad Meacham said in a statement. “Not only did these defendants shirk their tax obligations, they lied to investors and made off with their millions. Anyone else contemplating such a scheme should know that the Justice Department and its law enforcement partners have a sharp eye on the cryptocurrency space, and we will not let criminal behavior slide.”
In the company’s marketing material, they said their cryptocurrency, called Bitqy, was a way for “those individuals who missed out on Bitcoin” to get rich.
In 2016, they held their initial coin offering. This is when investors could first purchase the cryptocurrency. The people who bought it were betting it would increase in value.
To legitimize the Bitqy tokens, Bise and Mendez characterized them as “earned gifts” which would…
