According to a Department of Justice (DOJ) press release on Tuesday, a San Francisco man is headed to jail after a U.S. court fined him for carrying out a multi-million-dollar cryptocurrency scam.
Jerry Ji Guo, 33, was sentenced to six months by the U.S. District Judge Beth Labson Freeman ordered about $4.4 million in damages to be paid after he pled guilty to initial coin offering (ICO) theft.
Guo portrayed himself to customers as an ICO contractor at the height of the ICO craze in 2018, promising to conduct marketing and consulting services on behalf of startups in cryptocurrencies.
Rather than fulfilling his duties as promised, Guo embezzled cash and cryptocurrencies from customers. In November 2018, he was indicted for the crime by a Federal Grand Jury.
The guy from San Francisco pled guilty in August 2019 to one count of wire fraud. In a further seven counts, he was fined, but the extra charges were dropped. If he was found guilty on all offences, Guo was potentially on the hook for 20 years in jail, the Daily Beast reported at the time.
The U.S. government obtained a stipulated motion for a provisional order of forfeiture in 2019 and also obtained warrants to recover the funds of Guo’s client. According to the DOJ, the cryptocurrency is estimated at over $20 million,
“This case demonstrates that even when cryptocurrency is used in fraud, we can use criminal forfeiture to compensate fraud victims,” said the U.S. David Anderson’s solicitor.
Judge Freeman has directed Guo to serve a three-year term of surveillance by the authorities following his discharge from prison.