The US government says it has extradited Gutemberg Dos Santos, the co-founder of the Airbit Club Ponzi scheme from Panama, and he is now awaiting trial in a Manhattan court. Dos Santos is accused of his role in perpetuating a “cryptocurrency” scam that has defrauded victims of “tens of millions of dollars”.

Fraudulent Claims

According to the United States Department of Justice (DOJ), Dos Santos and five henchmen are accused of falsely promising victims that they will earn passive income from cryptocurrency mining. However, research found that “there was no bitcoin mining or trading on behalf of the victims.”

In a November 30 statement, the DOJ said Dos Santos – a citizen of Brazil and the United States – instead “hosted lavish exhibits and small community presentations to convince victims to purchase Airbit Club memberships.” Once Dos Santos and his henchmen took control of the money, they would trick unsuspecting victims into believing everything was above board. The DOJ press statement explains:

After a victim’s investment, a promoter gave the victim access to an online Airbit Club portal to view the alleged return on memberships. While the victims saw ‘profits’ accumulate on their online portal, those statements were incorrect.

Convinced that their “investment” would bring them an astronomical return, Dos Santos and his minions, meanwhile, used the victims’ funds to enrich themselves. As explained in the DOJ’s statement, the accused have “spent victim money on cars, jewelry and luxury homes, and funded more extravagant exhibits to recruit more victims.”

Bringing in the ‘new blood’

According to the DOJ, one of the defendants, attorney Scott Hughes, is individually accused of “helping to remove negative information about Airbit Club and Vizinova from the Internet.” Hughes previously represented Dos Santos when he was faced with an investigation by the US SEC.

In addition, the DOJ has accused Dos Santos and the co-defendants of using “excuses, delays and hidden charges” to deny victims access to their funds. In one case, a female victim was told that “she had to bring ‘new blood’ into the Airbit Club scheme to receive her proceeds.” The victim was made aware of this after she complained about her inability to make a recording.

In another case, a victim was told that his account had been closed and that the main investment had been lost. One of the defendants cited the following as the reason for the loss:

Due to implementation of Financial Sustainability Reserve, Policy # 34 of the Airbit Club Terms, due to the economic and financial crisis caused by (Covid-19).

According to the DOJ, a total of $ 20 million is believed to have been laundered by Dos Santos and his henchmen. As a result, Dos Santos, who has to meet three charges, can face a total prison sentence of up to 70 years.

Do you think Dos Santos imprisonment will help the victims? Share your thoughts in the comments below.

Image Credits: Shutterstock, Pixabay, Wiki Commons





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