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The founder of a cryptocurrency and virtual payment services company who authorities say cheated dozens of investors out of about $7.5 million, which he used to buy a house, cars, jewelry, and other luxuries, has been sentenced to more than eight years in prison.
Randall Crater, 52, founded Las Vegas-based My Big Coin Pay Inc. in 2013, offering virtual payment services through a fraudulent digital currency, My Big Coin, from 2014 to 2017, the U.S. attorney's office in Boston said in a statement on Tuesday.
Crater and associates he paid to promote the scheme through social media, email and text messages, said the coins were a fully functioning cryptocurrency backed by gold; that the company had a partnership with MasterCard; and that the currency could be exchanged for government-backed currency or other virtual currencies, none of which was true, prosecutors said.
MOST CRYPTO COMPANIES WILL 'CRASH' AFTER YEARS OF INDUSTRY PONZI SCHEMES: PALANTIR CO-FOUNDER
The Commodity Futures Trading Commission alleged that My Big Coin was a fraud in January 2018.