Bitcoin Scam: A Crooked Lawyer Guilty of Crypto Fraud

Their crime did not pay – Sooner or later, scammers always end up being caught by justice. Already, a little earlier in this month of February 2022, the couple behind the laundering of the 120,000 bitcoins stolen from the Bitfinex cryptocurrency exchange ended up being arrested. Today another scammer – former lawyer – went to the table, and confessed embezzling money for his own account, instead of buying bitcoins for his clients.

A disrespectful lawyer

Philip Reichenthal, is a former lawyer disbarred from the bar. He was stopped in September 2020, on a suspicion of an investment scam in Bitcoin (BTC), with his accomplice Randy Craig Levine.

According to a press release from the Court of the Southern District of New York, published on February 11, Reichenthal pleaded guilty charges against him: conspiracy to commit electronic fraud.

With his sidekick, they used a scheme to defraud investors who thought they were buying bitcoins. Taking advantage of his status as a licensed lawyer at the time of the events, Reichenthal collected millions of dollars as a fiduciary agent to act as an intermediary to buy bitcoins. Except that BTC are not never came afterwards.

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A total of $5 million embezzled

The accomplices would have in fact set up two fraudulent systems. First, between June and July 2018, they managed to extort $3 million to a first individual, designated by the press release as the “director of a cryptocurrency company”. The latter never saw the color of the promised bitcoins.

The second scam took place from February to May 2019. This time it is a resident of the State of Florida, designated as broker of bitcoin transactions, which sent $2 million to the crooked lawyer. Again, the unfortunate did not see the slightest bitcoin in return.

Disbarred from the bar in October 2019, the former lawyer therefore now has admitted his faultsfor which he faces a maximum penalty of 20 years imprisonment. Meanwhile, the extradition process for his accomplice Levine is still ongoing.

Will they be entitled, like the couple of Bitfinex hack scammers mentioned above, to their own series on Netflix to report their misdeeds? In any case, their false promises to buy Bitcoin will first lead them right in jail.

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