Hollywood Producer Admits to Scamming Crypto Investors, Bagging $2.5 Million

In totality, Felton has pleaded guilty to twelve counts of wire fraud, ten cases of money laundering, and two incidences of securities fraud.

By Radhika Parashar | Updated: 25 July 2022 16:16 IST

Hollywood Producer Admits to Scamming Crypto Investors, Bagging $2.5 Million

Photo Credit: Unsplash/ Bermix Studio

Felton spent the funds garnered from scams in buying house, cars, and jewellery

Highlights

Crypto scams are rising in number in the US
US’ DoJ has alerted crypto investors against trusting all projects
ICOs let investors pour money into upcoming projects for rewards

Ryan Felton, a Hollywood producer from Atlanta, has pleaded guilty to have been scamming crypto investors in order to maintain his extravagant lifestyle. Felton, known for his association in Hollywood projects like ‘Perception (2012)' and ‘One Last Time (2013)', has admitted to have bagged $2.5 million (roughly Rs. 20 crore) in crypto frauds. The 48-year-old has confessed to having promoted two initial coin offerings (ICO), one for an entertainment streaming platform called ‘FLiK' in 2017, and another for a crypto exchange called ‘CoinSpark' in 2018.

While promoting ‘FLiK', Felton claimed it would overtake Netflix and during CoinSpark ICO, the producer promised investors 25 percent of the exchange's profits as dividends. Botth the projects managed to garner investments, but Felton was the only one to have seen any funds coming out of these tricky initiatives.

In totality, Felton has pleaded guilty to twelve counts of wire fraud, ten cases of money laundering, and two incidences of securities fraud.

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US' Department-of-Justice (DoJ) has posted an official statement revealing more details on the case.

“He used the vast majority of the investor proceeds to fund his extravagant lifestyle, including all-cash purchases of a $1.5 million (roughly Rs. 12 crore) residence, a $180,000 (roughly Rs. 1.5 crore) red 2007 Ferrari 599 GTB Fioran Coupe, a new $58,250 (roughly Rs. 46 lakh) Chevy Tahoe, and approximately $30,000 (roughly Rs. 24 lakh) in diamond jewellery,” the DoJ revealed.

US authorities have cited the incident as an example to warn crypto investors against pouring money into random projects.

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“Felton's conviction should serve as a warning to anyone who seeks to capitalise on emerging technology to victimise others. The technology has advanced, but the crime remains the same, and those who invest in cryptocurrency must be wary of opportunities that appear too good to be true,” the blog noted.

Earlier this month, a report by transparency advocate and publisher, the BanklessTimes said that Americans crypto investors lost $185 million (roughly Rs. 1,500 crore) between January 2021 and March 2022 to romance scams and over $1 billion (roughly Rs. 8,000 crore) in total to other fraudulent activities.

In a bid to get ahead of potentially fraudulent scammers, the Australian Competition and Consumer Commission (ACCC) is undertaking a new trial that aims to take down scam websites targeting the crypto community in Australia.

The sentencing in Felton's case will be scheduled at a later date before US District Court Judge, J.P. Boulee.

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Further reading: Cryptocurrency, Ryan Felton, Crypto Scam

Radhika Parashar

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Radhika Parashar is a senior correspondent for Gadgets 360. She has been reporting on tech and telecom for the last three years now and will be focussing on writing about all things crypto. Besides this, she is a major sitcom nerd and often replies in Chandler Bing and Michael Scott references. For tips or queries you could reach out to her at RadhikaP@ndtv.com. More