Vegas Mother-Son Duo Alleged of a $12 Million Crypto Ponzi Scheme

2 days ago

The SEC shattered a cryptocurrency Ponzi scheme, where a mother and her son stole $12 million from more than 270 investors.

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The Securities and Exchange Commission obtained a temporary restraining order on a mother-son duo that embezzled more than $12 million from at least 277 investors. Throughout the years, the 86-year-old woman and her 54-year-old son promised to generate income for their clients via investing in securities and cryptocurrencies but instead swindled the funds for themselves.

The Deceptive ‘Supercomputer’

The Securities and Exchange Commission (SEC) announced that it had stopped the alleged offering fraud by Joy Kovar (86) and her son Brent Kovar (54). The team started its illegal operation in 2018 and has raised about $12 million from 277 investors since then.

The family used their Las Vegas-based company Profit Connect Wealth Services to lure people into a typical Ponzi scheme. They assured investors that they would allocate their money in securities trading and digital assets based on recommendations calculated by an “artificial intelligence supercomputer.” Michele Wein Layne – Director of the SEC’s Los Angeles Regional Office, commented:

“As we allege, the defendants targeted investors who were looking for safe products for their retirements and their children’s educations, offering a money-back guarantee on top of the phenomenal results they promised to achieve using a purported “supercomputer.” Investors should be wary of individuals and firms who guarantee double-digit returns with no risk of loss.”

The alleged firm insisted that the “supercomputer” would guarantee at least 20-30% fixed returns annually with monthly compounding interest. According to the SEC, though, the Kovar family did not use the funds coming from investors to trade securities or buy cryptocurrencies.

Instead, they transferred “millions of dollars to Joy Kovar’s personal bank account,” paid huge amounts of money to promoters, and made Ponzi-like payments to other investors. Additionally, more than 90% of Profit Connet’s funds came from investors.

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Per the accusations, Joy Kovar opened eight accounts at three different banks. In his turn, Brent Kovar once received more than $350,000 from investors, which he used to buy a residential home for himself. A hearing on July 26th, 2021, would determine the legal consequences of the illegal actions of the mother-son duo.

15 Years in Prison for Stealing $16M in BTC

Earlier this month, CryptoPotato reported about the case of Roger Nils-Jonas Karlsson. The Swedish resident pleaded guilty to luring at least 3,575 people into a fraudulent Bitcoin investment scheme. According to the investigation, he embezzled more than $16 million from his illegal actions and will spend the next 15 years in federal prison.

The 47-year-old man skimmed thousands of people in a “Ponzi scheme” between 2012 and 2019. During that period, the criminal convinced more than 3,500 people to send him funds in bitcoin and other digital assets, which he later used for personal enrichment, acquiring a resort in Thailand, luxurious condos, and even a racehorse.

After a successful investigation, the Department of Justice (DOJ) halted his criminal operations. In addition to the 180 months behind bars, he had to forfeit the Thai resort alongside other properties that he bought throughout the years.

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