Trending
  • Bitcoin to dramatically increase crypto market dominance in 2019
  • Binance to launch its own blockchain Binance Chain soon
  • Bitcoin faces second largest difficulty drop in history after latest adjustment
  • US Department of Homeland Security to monitor Blockchain Transactions

CEO of Arisebank Arrested Over Fraud Charges

img02

The 30-year old CEO of cryptocurrency firm AriseBank, Jared Rice Sr., was arrested on November 28 by the FBI. According to a news release from the US Attorney's Office for the Northern District of Texas, Rice was indicted over an alleged $4 million scam by defrauding hundreds of investors.

Previously, a civil action against the CEO was filed by the US Securities and Exchange Commission (SEC)'s Fort Worth regional office in February. He was then charged on three counts of securities fraud and three counts of wire fraud for the same cryptocurrency scheme.
In January too, Rice, along with the company's co-founder Stanley Ford, was ordered to stop providing any "banking services" to the state's residents by Texas regulators on the issuance of an unconditional Emergency Cease and Desist Order.

"Even as he touted AriseBank's nonexistent benefits in press releases and online. Mr. Rice quietly converted investor funds for his own personal use, spending the money on hotels, food, clothing, a family law attorney, and even a guardian ad litem", he stated.

Rice has also been accused of making false claims of AriseBank being the world's "first decentralized banking platform" and that his Initial Coin Offering (ICO) for AriseBanks's proprietary digital token, AriseCoin, had raised $600 million within weeks.
Moreover, AriseCoin's white paper promised the bank's customers would obtain Federal Deposit Insurance Corporation (FDIC) insured accounts and traditional banking services. However, in reality, Rice's crypto bank was not authorized to conduct banking services in the state of Texas not was it FDIC insured. His claim of having partnered with Visa in order to offer credit and debit cards to his customers also stands to be false.

The money that Rice raised from Cryptocurrency investors, was spent for his own personal interests, according to the statement published by Erin Nealy Cox, US Attorney for the Northern District of Texas.
"Even as he touted AriseBank's nonexistent benefits in press releases and online. Mr. Rice quietly converted investor funds for his own personal use, spending the money on hotels, food, clothing, a family law attorney, and even a guardian ad litem", he stated.

According to the Attorney's Office, if convicted, Rice faces up to 120 years in federal prison.

According to the Attorney's Office, if convicted, Rice faces up to 120 years in federal prison. Nealy further added: "My office is committed to enforcing the law in the cryptocurrency space. The Northern District of Texas will not tolerate this sort of flagrant deception-online or off."
Recently, My Crypto Mine, a crypto investment firm, has been charged with the sale of unregistered securities, engagement in fraud and public deception, in an Emergency Cease and Desist Order issued by the Texas Securities Commissioner. The same has also been issued by the Texas State Securities Board to another crypto company for the sale of unregistered securities to Texas residents.

loading...