Downtown Brooklyn

Former investment banker to be arraigned on cryptocurrency fraud charges

April 12, 2023 Robert Abruzzese
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DOWNTOWN BROOKLYN — A former investment banker and registered broker appeared in federal court in Brooklyn on Tuesday to be arraigned on charges related to a cryptocurrency investment fraud scheme.

Rashawn Russell, who is 27 years old, was arrested in Brooklyn on Monday and was arraigned on Tuesday before U.S. Magistrate Judge Ramon Reyes, Jr.

“As alleged, Russell turned the demand for cryptocurrency investments into a scheme to defraud numerous investors in order to fund his lifestyle,” U.S. Attorney Breon Peace said. “This Office will continue to aggressively pursue fraudsters perpetrating these schemes against investors in the digital asset markets.”

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According to the U.S. Attorney’s Office, Russell allegedly exploited the demand for cryptocurrency investments to defraud numerous investors in order to finance his lifestyle.

Court documents reveal that Russell allegedly defrauded multiple investors by falsely promising their money would be used for cryptocurrency investments that would generate substantial, and sometimes “guaranteed,” returns. In reality, much of the investors’ money was misappropriated by Russell for personal use, gambling, and repaying other investors.

Russell previously worked as an investment banker and was a registered broker with the Financial Industry Regulatory Authority.As part of the scheme, Russell is accused of lying to investors about the status of their investments and fabricating documents that he sent to them. One example includes sending an altered image of a bank balance displayed on a bank website, purportedly showing Russell’s significant liquidity. When another investor attempted to recoup their investment, Russell allegedly failed to return the money and instead sent the investor a fabricated bank wire transfer confirmation.

Russell is presumed innocent until proven guilty beyond a reasonable doubt, and if convicted, he faces up to 20 years in prison.

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