Alchemy Coin ICO scammer faces 80 years in prison for over $ 7 million COVID scam

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Justin Cheng has pleaded guilty to defrauding the US government of more than $ 7 million through the COVID-19 relief program. The Taiwanese national, who resides in New York, also admitted to conducting a fraudulent ICO in 2017 for Alchemy Coin.

In its announcement, the US Department of Justice said that as of April 2020, Cheng had used the identities of other people to apply for COVID-19 relief funds. The funds were part of the CARES Act to save small businesses and allow them to keep jobs and offset other expenses during the brutal economic times. Cheng applied for loans from at least five financial institutions, obtaining more than $ 7 million. In his demands, he falsely claimed that his companies employed more than 200 people and paid a total of $ 1.5 million in wages, authorities said. However, it only had 14 employees.

Cheng allegedly submitted fraudulent and falsified tax records to obtain the loans. In some applications, it has listed the names of several athletes, actors, artists and other public figures like its employees.

Once he received the loans, he allegedly used it for personal expenses, including a $ 40,000 18-karat Rolex watch, a $ 17,000-per-month condominium, a Mercedes Benz and over $ 37,000 in brand clothes.

Aside from the COVID-19 relief fund fraud, Cheng also pleaded guilty to conducting a fraudulent ICO in 2017. As of April this year, he reportedly sought an investment in Alchemy Coin Technology Limited.

The DoJ said, “These investments were obtained through materially false and misleading statements and omissions regarding Alchemy Coin’s access to capital, use of investor proceeds, preparation of proceeds from its purported trading platform. blockchain-based peer-to-peer lending and registration of its tokens as part of an initial coin offering. “

The 24-year-old has pleaded guilty to one count of bank fraud, securities fraud, wire fraud and major fraud against the United States. Collectively, he faces up to 80 years in prison for his crimes. He faces conviction on August 3 by District Judge Alison Nathan.

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