Maksim Zaslavskiy, the creator of REcoin, has bagged an 18-month sentence for his defrauding role in real estate and diamonds ICOs. He is also facing a huge fine by the Securities and Exchange Commission for matters related to civil charges. The amount of fine is not set yet, but a court will determine that at a later date.
U.S. Attorney Donoghue stated that Zaslavskiy committed a conventional technology-related fraud of deceit. The case began in 2017 after a civil complaint was filed by both the Department of Justice and SEC. They claimed Mr. Zaslavskiy deceived investors by claiming there was a tangible property in the name of REcoin to invest. But in the real sense, there was nothing like that. Zaslavskiy is convicted of two ICOs – DRC World, Inc, and REcoin LLC. The court stated that Zaslavskiy and his accomplices fraudulently sold the offerings to the public.
Zaslavskiy offered REcoin ICO to the public in July 2017. He deceitfully convinced the public that he and his team are floating the foremost cryptocurrency based on real estate. Afterward, he marketed Diamond ICO as a tokenized membership and exclusive pool. The diamond IOC offer was backed by diamonds, according to him
But in the real sense, Zaslavskiy did not buy any of these investments. He also sent worthless certificates to investors in a bid to convince them to part with their money. Besides, Zaslavskiy also deceitfully informed the public that REcoin had a team of accountants, brokers, professionals, and lawyers. He misinformed investors that his team has sold about 2.8 million REcoin tokens, and this team would invest the earnings in real estate.
Donoghue reiterated that the U.S. would not stop in its bid to keep sensitizing the financial sector and prosecute defrauders of investors. Whether the fraud is through virtual money or traditional securities, he said his attorney's office would keep prosecuting those the law finds guilty of fraud or manipulation.
Initially, SEC had proposed a sentence of more than 18 months for Zaslavskiy because the two crimes committed were too high in scope and nature. It’s a case of complete deceit, as the defendant knows what he was doing. According to the SEC, the levels of the two crimes should attract at least three years of imprisonment.
The government noted that Zaslavskiy’s case is a clear case of someone who is already bent on deceiving people, no matter what it will cost his victims. The Government reiterated that, even when SEC was still on the REcoin ICO case, he tried to move into another face of deceit by fraudulently introducing Diamond ICO.
In his defense, Zaslavskiy argued that although he made false statements and exaggerated about REcoin, his main aim was not to deceive investors, but to get them to invest in his project. However, the Government reiterated that Zaslavskiy has everything in plan from the onset to deceive investors and cause them financial loss.
The judgment on Zaslavskiy comes after regulatory agencies, and the U.S government has increased efforts to clamp down on frauds related to cryptocurrency.
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