On May 31, former investment banker Rashawn Russell was sentenced in Eastern New York District Court in Brooklyn to 41 months in prison for wire fraud in a cryptocurrency scheme and an unrelated access device fraud scheme. The former Deutsche Bank executive pleaded guilty to the charges in September. 

According to the Justice Department (DOJ), Russell ran the fraudulent R3 Crypto Fund between November 2020 and August 2022. The fund promised to make cryptocurrency investments and pay large, sometimes guaranteed, returns. In reality, Russell used investors’ money for his personal benefit or to repay other investors. He also falsely claimed to have wired money to investors asking to be repaid.

Former banker sentenced to 41 months for crypto fraud image 0 The indictment of Rashawn Russell. Source: business.cch.com

Russell was also a registered broker with the Financial Industry Regulatory Authority. He could have been sentenced to 30 years in prison on the charges. He was also ordered to pay $1.5 million in restitution to the victims of the crypto scheme.

Separately, between September 2021 and June 2023, Russell obtained 97 bank cards with at least 43 identities with the intention of using them for fraudulent transactions.

Related: Crypto losses from fraud and hacks declined 12% in May — Immunefi

Prosecutors charged Russell on the crypto-related count in April 2023. He pleaded guilty to all the charges in September.

Lots of criminal crypto action foiled

Russell’s conviction is one of a rash of fraudsters who faced justice in the last two months. On April 12, computer security engineer Shakeeb Ahmed was sentenced to three years in prison followed by three years of supervised release in Southern New York District Court for flash loan attacks on crypto exchanges in 2022.

Former banker sentenced to 41 months for crypto fraud image 1 Source: Nicki Kenyon

On May 15, the DOJ charged brothers Anton Peraire-Bueno and James Pepaire-Bueno with conspiracy to commit wire fraud, wire fraud, and conspiracy to commit money laundering for manipulating the Ethereum blockchain.

On May 18, Thomas John Sfraga pleaded guilty to a wire fraud charge in connection with a nonexistent crypto wallet and other schemes. On the same day, two people were arrested on seven counts of money laundering and international money laundering involving funds from a pig-butchering crypto scam worth over $73 million.

Magazine: U.S. enforcement agencies are turning up the heat on crypto-related crime