A Camarillo man was one of three people arrested Tuesday in connection with a cryptocurrency mining scheme that allegedly defrauded investors out of $722 million, according to the Justice Department.
Joseph Frank Abel, 49, and his cohorts, Matthew Goettsche of Lafayette, Colo., and Jobadiah Weeks of Arvada, Colo., are accused of operating a high-tech Ponzi scheme under the guise of an illegitimate business called BitClub Network from April 2014 through December 2019.
The indictment alleges the three solicited money from investors on the basis that they would receive huge returns for helping fund BitClub’s Bitcoin mining pools. The group is accused of providing false and misleading earnings figures to the investors that seemingly incentivized them to sink more money into BitClub.
Additionally, Abel and the others allegedly conspired to sell shares of BitClub Network to investors — securities not registered with the Securities and Exchange Commission.
Abel was charged by indictment with conspiracy to offer and sell unregulated securities, which has a maximum penalty of five years in prison and a fine up to $250,000. Goettsche and Weeks are charged with the same, as well as conspiracy to commit wire fraud. A timeline for their court appearances has not been released. Two unidentified defendants remain at large.
U.S. Attorney Craig Carpenito, who is prosecuting the case, credited the FBI’s L.A. Division’s West Covina Resident Agency, the IRS-Criminal Investigation unit and the IRS L.A. Field Office with the investigation leading to the charges.