A Romanian developer pleaded guilty to his role in the Bitclub Network, a crypto mining scam that hoodwinked investors off $722 million. The developer was sentenced to five years in prison and a fine of $250,000.
According to a press release from the U.S. The Department of Justice, Silviu Balaci was arrested at his residence in Germany. In addition, the release notes that the Romanian pleaded guilty to a dual-object conspiracy to commit wired fraud through video conferencing.
Balaci was the mastermind behind crypto mining scam
Indeed, one of the key figures behind the Bitclub Network was the Romanian programmer, who duped investors off $722 million. Notably, the crypto mining scam has attracted U.S. investors to invest in alleged shares in a cryptocurrency block reward mining project. The crypto mining scam ran between April 2014 and December 2019.
Balaci, along with his colleagues Matthew Goettsche and Russ Albert Medlin, was reportedly in charge of the company’s technical areas. According to DoJ’s press release, Balaci referred to potential investors as “dumb” and said they were “building this whole model on the backs of fools.”
Bitclub Network co-founder indicted
In addition, Balaci’s sentence comes three weeks after the arrest of the other founder of Bitclub, Russ Albert Medlin. In addition, Medlin has been apprehended by the Indonesian law enforcement authorities and is facing charges against sexually assaulting minors.
The Indonesian police arrested him after he had been informed by his neighbours in Jakarta, who had seen some minors leaving his residence. In conclusion, if Medlin is sentenced in Indonesia, he may face up to 15 years behind bars for violating the law of land on the protection of minors. However, he is likely to be extradited to the United States for his role in the crypto-mining scam.