Crime Sheepshead Bay

Cryptocurrency con lands Sheepshead Bay programmer in prison

November 19, 2019 Meaghan McGoldrick
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A Sheepshead Bay computer programmer and cryptocurrency promoter was sentenced Monday to 18 months in prison for conspiring to commit fraud.

According to officials, 39-year-old Maksim Zaslavskiy and others fraudulently marketed a pair of ICOs, or initial coin offerings, to the public during what Crain’s New York called “Bitcoin mania” in 2017.

ICOs, a type of digital currency, were a “hot market” then, according to Crain’s. Investors poured more than $20 billion into thousands of crypto-deals — among them, “REcoin” and “Diamond,” sham ICOs headed by Zaslavskiy.

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The two currencies were based on real estate and diamonds, respectively. Zaslavskiy traded in neither, officials said, and the certificates he sent investors were worthless.

“Zaslavskiy committed an old-fashioned fraud camouflaged as cutting-edge technology,” United States Attorney for the Eastern District of New York Richard Donoghue said in a statement. “This office will continue to investigate and prosecute those who defraud investors, whether involving traditional securities or virtual currency.”

According to Crain’s, the tech-savvy Brooklyn conspirator “issued a slew of false and misleading statements” about the ICOs, which eventually got him about 1,000 investors and $300,000.

His acts eventually made him the first person to be charged criminally with ICO fraud, to which he pleaded guilty last year.

Restitution will be determined by the court at a later date, officials said Monday.


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