Jury Convicts AML Bitcoin Creator of Fraud and Money Laundering
A California jury has convicted the creator of a cryptocurrency exchange that was linked to Anti-Money Laundering (AML) compliance of wire fraud and money laundering.
In a March 12 trial in the U.S. District Court for the Northern District of California, a jury convicted Rowland Marcus Andrade, creator of AML Bitcoin, on two felony counts of defrauding investors. Criminal charges were initially filed in June 2020, alongside a civil action by the U.S. Securities and Exchange Commission (SEC) against Andrade and the NAC Foundation, where he was CEO and founder.
IRS Agent Calls Fraud Scheme ‘Outrageous’
Authorities allege Andrade swindled investors by falsely marketing AML Bitcoin as a next-generation cryptocurrency with compliance capabilities. But the digital asset was never put into operation.
“Mr. Andrade’s outrageous lies lured and swindled individuals into investing their hard-earned money into a new cryptocurrency with imaginary features,” said Linda Nguyen, Special Agent in Charge of the IRS Criminal Investigation Oakland Field Office.
“Rowland Marcus Andrade stole money from innocent people and spent it to further his own personal riches.”
SEC’s Civil Case Can Resume
The SEC’s civil case against Andrade involved political lobbyist Jack Abramoff, who already served four years in prison for corruption. A judge had put the SEC lawsuit on hold in January 2021, pending the outcome of Andrade’s criminal trial. With the conviction, the lawsuit can now resume.
Fraudulent ICO and False Claims
Prosecutors alleged that the NAC Foundation made false statements that AML Bitcoin would be compliant with anti-money laundering (AML) and Know Your Customer (KYC) regulations. Andrade used the statements to promote an initial coin offering (ICO) between 2017 and 2018.
According to trial evidence, Andrade diverted over $2 million of the ICO funds, which he spent on real estate and luxury cars.
The Department of Justice also highlighted false claims by Andrade, including one that the Panama Canal Authority was considering using AML Bitcoin in transactions. There was never such an agreement.
Sentencing Scheduled for July
Andrade has been free on a $75,000 bond since 2020 but under strict travel restrictions. His sentencing is scheduled for July 22.
He faces up to 20 years on the wire fraud charge and 10 years on the money laundering charge.
