United States authorities have brought criminal charges against a LocalBitcoins trader in connection with operating an unlicensed money transmission business, a government press release confirmed on May 28.
As revealed by the U.S. Attorney’s Office for the Southern District of California, Las Vegas resident Morgan Rockoons will serve 21 months in federal prison for his activities, which also included a bitcoin (BTC)-based real estate fraud scheme.
According to the release, Rockoons made over a thousand trades on the P2P platform until the end of 2017.
Having failed to register as a money transmitter with the Financial Crimes Enforcement Network (FinCEN), Rockoons had fallen onto the radar of San Diego law enforcement several years earlier as the biggest-volume trader in the area.
An indictment appeared in November 2017, with arrest in February the following year. After his release on bail, however, Rockoons began operating an allegedly outright criminal business, “Bitcointopia,” offering land which never existed in return for bitcoin.
“Victims who sent Rockcoons Bitcoin never received their title to land as promised. To date, agents have identified at least 10 victims of Rockcoons’ fraud,” the release confirms.
Rockoons was again arrested in October 2018, and plead guilty to crypto-related fraud charges in related to Bitcointopia as well as to operating a money transmitting business without a license in March of this year.
In total, the profits from the activities topped $80,000, which Rockoons will now forfeit in addition to the jail term after his guilty plea.
The takedown continues an increasingly zero-tolerance policy towards informal trading in the U.S.. As Cointelegraph reported, regulators keen to standardize the landscape have brought charges against a host of individuals, many as part of the so-called Operation Cryptosweep which began in 2018.
In terms of crime, May also saw the halting of a major Ponzi scheme which involved 300 investors from the U.S. and Canada losing money to promoters of an allegedly diamond-backed cryptocurrency.
In Brazil, meanwhile, a separate swoop shut down a much larger pyramid scheme that reportedly defrauded over 55,000 people.
