Disbarred 85-year-old attorney, David Kagel, has pleaded guilty to conspiring to operate a cryptocurrency Ponzi scheme that defrauded victims of over $9.5 million.
According to court documents, Kagel, alongside his co-conspirators, promoted investment programs that falsely guaranteed high-yield profits through cryptocurrency trading bots.
Kagel and his co-conspirators misled victims by falsely claiming Kagel, as the promoter’s attorney, held 11 million in Bitcoin in escrow to secure investments. Kagel backed up false claims with misleading letters using his firm’s letterhead.
Kagel pleaded guilty to planning to commit commodity fraud. He could be sentenced to up to five years in prison which is scheduled on September 10th. The federal district court judge considers U.S. Sentencing Guidelines in determining the final sentence.
Kagel’s accomplices, David Gilbert Saffron of Australia and Vincent Anthony Mazzotta Jr. of Los Angeles were charged in December 2023 for their roles in the same cryptocurrency Ponzi scheme. They await trial starting on August 13, accused of misappropriating victims’ funds for personal expenses.
Also read: SEC Issues Urgent Crypto Scam Warning Amid AI Exploitation
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