Two of America’s very own Crypto Invictus Obi.

The United States Department of Justice has revealed that the owners of Bitqyck and Bitqym, two sham crypo currency companies have pleaded guilty to tax evasion and fraud. This announcement was made on Tuesday.

The two founders, Bruce Bise and Samuel Mendez were accused and charged with tax evasion and fraud in August. While Mr Bise pleaded guilty in Sept. 9, Mr Samuel Mendez pleaded guilty Tuesday morning. According to the plea papers, the Department of Justice detailed:

Mr Bice ‘motivating’ investors. Source: Youtube

“Mr. Bise and Mr. Mendez admitted that Bitqyck raised approximately $24 million from more than 13,000 investors. Instead of fulfilling their promises to these investors, the defendants used Bitqyck funds on personal expenses, including casino trips, cars, luxury home furnishings, art, and rent.”

The defendants used the rave surrounding cryptocurrencies like Bitcoin and ethereum to mislead their investors into investing in their company, squandering the proceeds, and hiding the income from the IRS, acting U.S. Attorney Chad Meacham described.

They marketed the company’s cryptocurrency, Bitqy, “as a way for those individuals who missed out on bitcoin to get rich,” the Department Of Justice noted,

The ‘white paper’ posted on the Bitqyck website promised investors that each Bitqy token came with 1/10th of a share of Bitqyck common stock. But, Bise and Mendez admitted that they neither distributed shares to investors nor embedded the shares within the Ethereum Smart Contract.

After the launch of Bitqy, Bise and Mendez began advertising another token, Bitqym. They claimed that buying the token allowed investors to join “Bitcoin mining operations.”

Bise and Mendez had initially settled with the U.S. Securities and Exchange Commission (SEC). The duo had  “agreed to pay an $8.3 million penalty to resolve claims that it defrauded investors and operated an unregistered digital asset exchange.”

The DOJ added that as part of that settlement, Bise and Mendez “agreed to pay disgorgement and penalties of $890,254 and $850,022, respectively.”

However, The DOJ stated that:

Both men now face up to five years in federal prison.

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