'Crypto Investing Club' Leader Spent Investors' Money on Jewellery, Real Estate

Michael Ackerman, 52, the leader of a fraudulent cryptocurrency fundraising group who used a stolen $9 million worth of cryptocurrency to buy real estate, Tiffany jewellery, and private security guards, pleaded guilty to wire fraud on Wednesday, according to an announcement from the Department of Justice.

"As he admitted today, Michael Ackerman raised millions of dollars in investments for his fake cryptocurrency scheme by falsely touting monthly returns of over 15 percent, falsifying documents to con investors into thinking his fund had a balance of over $315 million, and spending millions in investor funds on himself.  Now Ackerman awaits sentencing for his crime," U.S. Attorney Audrey Strauss said in a statement published with the announcement.

Beyond the jewellery and private security services, Ackerman also used his funds to travel and buy vehicles, the announcement adds.

Starting in around 2017, Ackerman and others started an investment fund where participants would send U.S. dollars with the hope that Ackerman would invest it into cryptocurrency. The investment fund claimed it was earning around 15 percent in profit each month, the announcement reads.

Later in 2019, Ackerman claimed that the fund had grown in value to around $315 million dollars. But Ackerman had faked screenshots to lie about the 15 percent profit and the $315 million fund total, the announcement added.

Ackerman faces a maximum sentence of 20 years in prison, and has agreed to pay restitution of at least $30,667,738.79, as well as forfeiture of $36,268,515, including the jewellery that he bought with the fraudulently gained funds.

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