The person behind the first ever Bitcoin securities fraud in the United States is going to spend the next 18 months in prison.
Trendon Shavers, the founder of Bitcoin Savings and Trust, a proven ponzi company, was convicted for luring people into investing 764,000 bitcoins (~$4.5 million at the time of investment) with the promise of 7% weekly returns. He later disappeared with the raised sum, reportedly spending it to pay early investors, and for his own leisures including gambling and spa sessions.
During the sentencing, the presiding Judge Lewis A Kaplan also ordered Trendon Shavers to pay $1.23 million back to 48 investors who lost their money to Bitcoin Savings Trust. He was also ordered to pay an equal amount as restitution charges for running a so-called ‘Classic Ponzi Scheme’ between 2011 and 2012.
Earlier last year, Trendon’s lawyer Jason Seibert had accused the US Securities and Exchange Commission (SEC) of abusing its authority by questioning his client for hours, even after he had pleaded guilty to the aforementioned securities fraud. The information obtained during the interrogation was then used in a parallel investigation without informing the accused about it.
At the Blockchain Agenda conference in San Diego, Jason Seibert was quoted saying,
“He (Trendon) didn’t know what he