Former investment banker Rashawn Russell was handed a 41-month prison sentence on May 31 in Eastern New York District Court in Brooklyn. He was convicted of wire fraud in a cryptocurrency scheme and an unrelated access device fraud scheme. Russell, a former executive at Deutsche Bank, had pleaded guilty to the charges back in September.
According to the Department of Justice (DOJ), Russell operated the fraudulent R3 Crypto Fund from November 2020 to August 2022. The fund promised investors high returns from cryptocurrency investments. However, instead of investing the money, Russell used it for personal gain or to repay other investors. He also made false claims of wiring money to investors who requested repayment.
In addition to his role in the crypto scheme, Russell was a registered broker with the Financial Industry Regulatory Authority. He could have faced up to 30 years in prison for his crimes. Additionally, he has been ordered to pay $1.5 million in restitution to the victims of the cryptocurrency scheme.
Separately, between September 2021 and June 2023, Russell obtained 97 bank cards using at least 43 different identities. His intention was to use these cards for fraudulent transactions.
Prosecutors initially charged Russell with the crypto-related offenses in April 2023. He pleaded guilty to all charges in September.
Russell’s conviction is part of a recent crackdown on crypto-related fraud. In the past two months, several fraudsters have been brought to justice. For example, on April 12, computer security engineer Shakeeb Ahmed was sentenced to three years in prison for flash loan attacks on crypto exchanges in 2022.
On May 15, the DOJ charged brothers Anton Peraire-Bueno and James Pepaire-Bueno with conspiracy to commit wire fraud, wire fraud, and conspiracy to commit money laundering for manipulating the Ethereum blockchain.
On May 18, Thomas John Sfraga pleaded guilty to a wire fraud charge related to a nonexistent crypto wallet and other schemes. On the same day, two individuals were arrested on multiple counts of money laundering and international money laundering involving funds from a pig-butchering crypto scam worth over $73 million.
Law enforcement agencies in the United States are ramping up efforts to combat crypto-related crime.