The Utah District Attorney’s Office in the US accused James Wolfgram, the founder of Bitex LLC and Ohana Capital Financial, of digital asset fraud, defrauding investors and money laundering.
James Wolfgramm, known as Semisi Niu, James Vaka Niu and Spanish Fork, has been charged with seven felonies, wire fraud and money laundering via crypto-assets, according to the US Department of Justice. Because of his fraudulent cryptocurrency schemes, investors have suffered major losses, many with little knowledge of crypto-assets.
Wolfgram used different pseudonyms on social media, posing as a multimillionaire. To impress potential investors and gain their trust, he posted pictures of luxury cars, expensive watches and other luxury items. However, investigators found that they were someone else’s photos, taken from other social media accounts.
Wolfgram defrauded two investors of $1.7 million by selling them a “powerful cryptocurrency mining machine” called Bitex Blockbuster. Wolfgram demonstrated one of the devices in his office, allegedly connected to a screen that showed a pre-recorded mining cycle, giving the impression that the equipment was working efficiently.
As for Ohana Capital Financial, the company provided financial services to individuals without access to banking services. Wolfgram managed to collect several million dollars from clients as a deposit. This money was to be held in client accounts until the users themselves wanted to withdraw it. However, the funds were spent on commercial expenses unrelated to the company.
As the number of cryptocurrency fraud cases has been increasing over the past few years, this month the US Department of Justice announced the creation of a National Cryptocurrency Law Enforcement Task Force. The task force will also be involved in investigating digital asset crime.
Don’t forget to subscribe to our Telegram channel.