Cryptocurrency is becoming more popular as the Internet expands, and more tech-savvy companies and individuals turn to this alternate form of currency. Cryptocurrency is all digital and is decentralized. This means that this type of currency is managed outside of governments and central bank authorities’ authority.
This type of currency has become more popular as people have turned to the digital world to secure payment for goods and services. However, the currency is also so new that laws and regulations concerning cryptocurrency are vague at best. Thus, there is a lot of room for interpreting different actions as cryptocurrency fraud, money laundering, or being accused of making illegal purchases for goods or services using this currency.
If you have been accused of any fraud or crime that involves digital currency, you need to secure the services of a cryptocurrency fraud lawyer. The outcome of your case will depend heavily on the quality of your legal representation.
Fraudulent Initial Coin Offerings (ICOs)
One of the most common charges for cryptocurrency fraud is when a new business is accused of fraudulent initial coin offerings. To understand this type of cryptocurrency fraud, you must look at what an ICO is and how someone may believe cryptocurrency fraud occurred.
Many new technology companies are using Initial Coin Offerings as a way to fund their startup. These companies are trying to develop their own cryptocurrency or technology that manages this form of currency. In most cases, these companies seek other cryptocurrency forms to operate their business until their cryptocurrency is launched.
When a company puts out an Initial Coin Offering they are also generating a list of potential clients for when their coins are launched. These investors are given a first-option for more coins at a set price or have guaranteed values for the coins they have already pre-purchased during the offering.
Many companies are accused of cryptocurrency fraud when their startup fails. They cannot provide these investors with the shares of their new currency as promised during the initial offering. But how do you distinguish cryptocurrency fraud from just poor business practices?
This is why it is crucial to have a qualified cryptocurrency fraud lawyer manage your case when you or your company has been accused of cryptocurrency fraud.
Types of Cryptocurrency Fraud
Since cryptocurrency is so new, there is very little law that actually pertains to the currency and its handling. In most cases, when you are being investigated for cryptocurrency cybercrime, you are being investigated for one or more of the following crimes:
- Computer fraud
- Banking or Wire fraud
- Mail fraud
- Money laundering
- Bank Secrecy Act violations
- Securities Act of 1933 violations
- Securities Exchange Act of 1934 violations
- Commodity Exchange Act violations
- Conspiracy to commit banking, computer, or wire fraud
- Tax Evasion
An investor may also seek legal actions against a company for cryptocurrency fraud recovery if they believe that they were a fraudulent investing victim. However, cryptocurrency fraud recovery would be separate from a criminal investigation or charge.
Cryptocurrency Fraud Can Result In Different Federal Charges
Because money crosses state lines, most cases of currency fraud are handled at the federal level. Since cryptocurrency is a very new form of currency, the Department of Justice or the Securities and Exchange Commission can handle cases involving fraud. A majority of these cases come straight from the Department of Justice.
It is essential to understand that all of these charges are serious felonies and can carry significant prison terms if you are convicted. Federal fraud charges for just one count can carry a prison sentence of up to 20 years in a federal facility.
The federal government is very aggressive about prosecuting cryptocurrency cases. The lack of regulation concerning this currency gives federal prosecutors almost “free-range” to press various charges against the individuals or companies that have been accused of fraud. In many cases, the final conviction may not even be for currency fraud but another charge such as violations of the Securities Exchange Act of 1933.
Our law firm believes that this “free-range” approach to convicting someone accused of a cryptocurrency crime is not right, and we will aggressively represent our clients to protect their rights.
You must work with a knowledgeable law firm about these charges and how the federal prosecution manages these cases. The best way to protect your rights and to have a successful defense is to work with a defense law firm that is willing to go the extra mile to ensure you have the best defense against any charges that may arise during the course of your investigation or case.
Getting The Representation You Need
If you are currently under investigation or have been officially charged with cryptocurrency fraud, it will be necessary to have a qualified attorney manage your case.
Cryptocurrency is very new, and many issues concerning this currency and the potential misuses have not been presented to the courts for consideration. This means that every issue in your case could be a new issue and could set how things are handled for future cases.
With the potential for very long prison sentences, if convicted, you must work with a defense law firm that understands digital assets, digital investing, and how cryptocurrencies as a whole work on and off the Internet. Your defense attorney must have an active and accurate account of this industry for effective representation.
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