The US District Court for the Eastern District of New York is located in the Brooklyn borough of New York City on January 18, 2019.
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Federal prosecutors on Friday advertised positions against a German businessman, accusing him of having defrauded investors of more than 150 million dollars in a crypto fraud scheme.
Prosecutors said Horst Jicha promoted USI Tech, the company he founded and led as CEO, as a cryptocurrency mining and trading platform โaccessible to the average retail investor.โ But in reality, Jicha and two unnamed accomplices, both USI Tech executives, lured and defrauded investors in a "multi-level marketing scheme," prosecutors allege.
Authorities said they arrested Jicha and unsealed an indictment containing four counts against him (securities fraud and conspiracies to commit securities fraud, wire fraud and money laundering) after he entered the United States for the first time in more than five years old on December 23, heading to Miami for vacation. He was arraigned in federal court in Brooklyn on Friday morning.
Prosecutors allege that the company falsely claimed on its website, in social media posts and at in-person events that investors could earn up to 140% returns on cryptocurrency investments made through its platform.
Around spring 2017, Jicha and his accomplices began "aggressively promoting" USI Tech, prosecutors said. There were live events, including one in Valley Forge, Pennsylvania, where one of Jicha's co-conspirators claimed that USI Tech's legality had been blessed by "the best lawyer in the SEC," according to the indictment.
In 2018, when regulators began scrutinizing USI Tech, prosecutors alleged that Jicha ended the company's operations in the United States, preventing investors from withdrawing their money. Since then, about $150 million of that money has been transferred to accounts controlled by Jicha, prosecutors said Friday.
โIt is always difficult when investors have suffered losses at the hands of certain bad actors,โ Marissel Descalzo and David Tarras, lawyers at Jicha, wrote in a statement. "We look forward to zealously defending the allegations against Mr. Jicha and exposing the facts of his involvement with USI Tech in the hopes that bad actors will be brought to justice."
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