A former Deutsche Bank investment banker, Rashawn Russell, has been indicted for misappropriating funds from investors he promised big returns through cryptocurrency trading. The 27-year-old from Brooklyn solicited investments from friends and colleagues, but used the funds for gambling and other personal expenses, according to federal prosecutors.
Misleading Prospective Investors
Russell allegedly told prospective investors that he was a licensed broker who worked in investment banking and could help them earn large, sometimes guaranteed returns from R3, a cryptocurrency fund he claimed to run. However, he transferred some funds into a trading account but siphoned off the rest and sent false documentation to investors regarding their investments.
Arrest and Charges
Russell was arrested on Monday in Brooklyn after being charged with wire fraud, following a sealed indictment last Thursday. The scheme, which prosecutors said ran from November 2020 through August 2022, could lead to a lengthy prison sentence if found guilty. At his Tuesday afternoon hearing in Brooklyn federal court, he pleaded not guilty.
Cracking Down on Fraud
Regulators and prosecutors in the US have been working to crack down on cryptocurrency fraud. According to U.S. Attorney in Brooklyn, Breon Peace, “Russell turned the demand for cryptocurrency investments into a scheme to defraud numerous investors.”
Response from Deutsche Bank
Deutsche Bank declined to comment on an ongoing legal proceeding, but stated that it “regularly supports law enforcement and regulatory oversight efforts, including appropriately responding to and cooperating with authorized investigations and proceedings.”
Conclusion
The cryptocurrency industry is becoming increasingly regulated as regulators and law enforcement agencies aim to protect investors from fraud. Rashawn Russell’s case is yet another reminder that individuals who mislead investors for personal gain will face severe consequences. As the industry continues to grow, it is essential that investors remain vigilant and seek advice from regulated professionals before investing in cryptocurrency.
