Cryptocurrency

Crypto-Fraud Alert: Ohio-based Cryptocurrency Scammer Pleads Guilty to Wire Fraud

Michael Ackerman admits to stealing over $30 million in investor funds

According to the U.S. Attorney’s Office, Michael Ackerman, of Sheffield Lake, Ohio, pleaded guilty last week to one count of wire fraud in connection with a multimillion-dollar cryptocurrency scam that he orchestrated. Ackerman faces a maximum sentence of 20 years in prison for his misconduct.

In February 2020, the Securities & Exchange Commission filed civil fraud charges against Ackerman alleging that he and two business partners (one of whom was a surgeon) had unlawfully raised funds for a private investment pool dubbed the Q3 Trading Club (“the “Fund”). The Fund targeted physicians through Facebook groups and word of mouth.

In announcing the guilty plea, federal prosecutors stated:

The Fund was an investment club that allowed its members to contribute U.S. dollars, which the investors were told would then be used to invest and trade in Bitcoin and other cryptocurrencies. Ackerman was held out as the Fund’s chief trading officer and personally controlled the Fund’s primary trading account on an online cryptocurrency exchange. Based on figures provided by Ackerman, the Fund claimed that its proprietary trading algorithm was earning approximately 15 percent in profit for investors each month.

In reality, the Fund’s reported performance and overall balances were false, and Ackerman created phony screenshots to fool investors about the Fund’s actual performance.

Prosecutors say that Ackerman stole at least $9 million in investor contributions and used the money to bankroll a lavish lifestyle that included his purchase of multiple pieces of real estate, hundreds of thousands of dollars of Tiffany jewelry, vehicles, travel, and personal security services.

As part of the plea, Ackerman agreed to make restitution of at least $30,667,738.79. Ackerman also agreed to forfeiture of $36,268,515, including the millions of dollars in cash, real estate, and jewelry that were fraudulently obtained from victims or bought with victim funds.

Just days before Ackerman’s guilty plea was announced, the SEC issued an investor bulletin warning investors about crypto and other digital asset investment scams.

The law firm of Meyer Wilson has an active cryptocurrency and digital asset fraud practice group. If you believe that you have been the victim of a crypto or digital asset scam, please contact the experienced investment fraud lawyers at Meyer Wilson for a complimentary consultation.

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