The CEO and founder of Mining Capital Coin (MCC), Luiz Capuci Jr. was indicted by The Department of Justice (DOJ) for allegedly running a $62 million global investment fraud scheme.
As per the press release from DOJ, Capuci Jr. misled investors via his company to buy “Mining Packages” and promised substantial returns from mining new cryptocurrencies in what MCC described as its international network of crypto mining machines.
Capuci promised a certain weekly return on the investment but rather than using the investors’ fund to mine cryptocurrency, he diverted all the funds to e-wallets controlled by him and other co-conspirators. The DOJ also accused Capuci for marketing and selling another fraudulent MCC product known as “Trading Bots”.
“Trading Bots”, according to Capuci were bots which operated at “very high frequency, being able to do thousands of trades per second,” and that each MCC Trading Bots would produce daily returns for investors.
Many crypto leaders are getting accused and it does not come as a surprise because this pattern has repeated many times. Crypto scams conducted by founders are getting more common, the DOJ recently charged BitConnect’s founder for a $2 billion crypto scam which is believed to be the biggest crypto scam till date.
MCC was definitely running a pyramid scheme. Capuci recruited associates and promoters to lure and trick investors. In return, he promised the promoters a number of expensive gifts, including Apple watches, iPads and luxury vehicles.
The U.S. SEC issued a fraud alert and revealed that Capuci never registered his company with the SEC. SEC revealed that Capuci and other unnamed co-conspirators successfully tricked 65,535 investors to buy mining packages and in total MCC netted $8.1 million from the sales of mining packages and $3.2 million from the initiation fees.
The money funded a very luxurious lifestyle, which included Lamborghinis, a yacht and real estate, according to the SEC complaint.
The SEC alleged that investors were promised returns in Bitcoin (BTC) at first, anyhow this was eventually changed to MCC’s Capital Coin (CPTL), which could only be redeemed on Bitchain “a fake crypto asset trading platform Capuci created and managed”.
Capuci is charged with conspiracy to commit wire fraud, conspiracy to commit securities fraud, and conspiracy to commit international money laundering. He will face up to 45 years in prison if proven guilty on all counts. The FBI Miami field office and Homeland Security Investigations are currently investigating the case.
