A US District Court has sentenced a man to three years in prison in a cryptocurrency mining fraud case. According to the U.S. Department of Justice (DOJ), the defendant “misappropriated the victim’s money and failed to provide the victim with the miner and miner hosting services that she purchased from him.”
Man Sentenced to Prison for Defrauding Investors in Crypto Mining Scheme
The U.S. Department of Justice (DOJ) announced Thursday that Chester (Chet) Stojanovich was sentenced to three years in prison “for defrauding purchasers of cryptocurrency miners and minor hosting services.” He pleaded guilty last November to one count of wire fraud.
The DOJ found that from at least 2019 until his arrest in April 2022, Stojanovich “provided customers with special computers that mined cryptocurrency (“miners”) and miner hosting services, offering victims a lucrative stream of “hash power” that could be converted into cryptocurrency to the victims, and allegedly defrauded more than a dozen victims out of more than $2 million through fraudulent misrepresentations,” he explained. The DOJ added that
Instead, Stojanovich misappropriated the victims’ money and failed to provide the minor and minor hosting services that the victims purchased from him.
In addition to failing to provide the purchasers with the purchased cryptocurrency mining equipment and hosting services, the DOJ stated that Stojanovich “acted deceptively to create the illusion that such miners were being acquired and used to provide hashing power to those customers to do so.”
Additionally, the DOJ detailed that Stojanovich “misappropriated customer funds and used the funds for unrelated and personal expenditures, including charter flights, hotel rooms, limousines, and private parties.” Noting that Stojanovich was sentenced Thursday before U.S. District Judge Denise Cote, the DOJ concluded.
In addition to the prison sentence, Stojanovich … . was sentenced today to three years of supervised release, forfeiture of $2,158,927, and restitution to the victims in the amount of $2,108,927.
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