Article in this post:A federal judge in Texas has put the SEC's case against bitcoin miner Geosyn on hold after federal prosecutors accused the company's executives of fraud.Geosyn's CEO and COO stole investor funds in exchange for buying mining equipment and allegedly spent them on luxury trips, watches and a Las Vegas wedding.
the SEC agreed to freeze the case after the defense argued that President Trump's new #cryptocurrency policy could change the SEC's position.
A federal judge in Texas, US, has put the SEC's case against #bitcoin #mining and hosting company Geosyn Mining LLC on hold after federal prosecutors filed criminal charges against three of the company's executives.
CEO Caleb Ward, COO Jeremy McNutt and former executives Jeremy McNutt and former sales manager Jared McNutt are accused of misusing customer funds and using investor funds for personal luxuries instead of mining equipment
the decision came after Ward and Jeremy McNutt appeared in court Thursday to face the charges. Prosecutors allege that the Geosyn executives engaged in ponzi-like operations and wire fraud under the guise of mining cryptocurrency.
the U. S. Securities and Exchange Commission initially opposed a stay on the lawsuit, but after reviewing new legal arguments from Ward's team, it agreed. According to court documents released this week, Geosyn executives made big promises to customers. Investors were told that their money would be used to buy and operate a bitcoin #miner and that profits from the machine would be returned to them. Instead, according to the criminal complaint, the funds were diverted for personal use.
According to prosecutors, Ward, Jeremy McNutt and Jared McNutt used the funds to finance their lavish lifestyles instead of buying mining equipment. According to DOJ documents, the three spent customers' money on Las Vegas weddings, trips to Disneyland, luxury watches and "business trips" to Miami, and spent thousands of dollars at restaurants and nightclubs.
estors. When customers expected profits from mining, Geosyn used funds from new customers to pay old customers, creating the illusion that the business was profitable.
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