Bitcoin Savings and Trust, Trendon Shavers Charged with $4.5Mln Fraud

Trendon Shavers, operating under the alias “pirateat40”, has been charged by US District Court for operating a Bitcoin-related Ponzi scheme, misappropriating approximately $4.5 million worth of Bitcoin Bitcoin While some may still be wondering what is Bitcoin, who created Bitcoin, or how does Bitcoin work, one thing is certain: Bitcoin has changed the world.No one can remain indifferent to this revolutionary, decentralized, digital asset nor to its blockchain technology.In fact, we’ve gone a long way ever since a Florida resident Laszlo Hanyecz made BTC’s first official commercial transaction with a real company by trading 10,000 Bitcoins for 2 pizzas at his local Papa John’s.One could now argue that While some may still be wondering what is Bitcoin, who created Bitcoin, or how does Bitcoin work, one thing is certain: Bitcoin has changed the world.No one can remain indifferent to this revolutionary, decentralized, digital asset nor to its blockchain technology.In fact, we’ve gone a long way ever since a Florida resident Laszlo Hanyecz made BTC’s first official commercial transaction with a real company by trading 10,000 Bitcoins for 2 pizzas at his local Papa John’s.One could now argue that Read this Term.

Bitcoin Savings and Trust, along with Mr. Shavers have been accused of illegally appropriating roughly 146,000 of 764,000 Bitcoins (estimated at $4.5 million) his operation raised between September 2011-12.

These charges follow on the heels of a September 18 order by a US Federal judge who ordered the payment of a $40.7 million fine, comprising of illegal profits and interest in a related US Securities and Exchange Commission (SEC) civil lawsuit.

A Texas man who operated Bitcoin Savings and Trust was charged on Thursday with bilking his investors, in what prosecutors called the first federal criminal securities fraud case arising from a Bitcoin-related Ponzi scheme.

According to U.S. Attorney Preet Bharara in a recent statement on the allegations, "Trendon Shavers managed to combine financial and cyber fraud into a Bitcoin Ponzi scheme that offered absurdly high interest Payments Payments One of the bases of mediums of exchange in the modern world, a payment constitutes the transfer of a legal currency or equivalent from one party in exchange for goods or services to another entity. The payments industry has become a fixture of modern commerce, though the players involved and means of exchange have dramatically shifted over time.In particular, a party making a payment is referred to as a payer, with the payee reflecting the individual or entity receiving the payment. Most commonl One of the bases of mediums of exchange in the modern world, a payment constitutes the transfer of a legal currency or equivalent from one party in exchange for goods or services to another entity. The payments industry has become a fixture of modern commerce, though the players involved and means of exchange have dramatically shifted over time.In particular, a party making a payment is referred to as a payer, with the payee reflecting the individual or entity receiving the payment. Most commonl Read this Term, and ultimately cheated his investors out of their Bitcoin investments. This case, the first of its kind, should serve as a warning to those looking to make a quick buck with unsecured currency."

Operating under the alias "pirateat40," Shavers had allegedly seized control of as much as 7% of the Bitcoin market under false promises to investors, stipulating potentially 7% weekly interest rates, or 3,641% annualized, given his proficiency in trading the digital currency.

Rather, Mr. Shavers illegally siphoned the funds for his own use, which included repaying off old debts and investors and outlandish personal expenses. Mr. Shavers faces charges of both securities and wire fraud, potentially carrying up to 20 years in federal prison.