Jared Rice Sr., the CEO of AriseBank, faces up to 120 years in prison for running a cryptocurrency scam that defrauded investors of millions.
One aspect of the cryptocurrency ecosystem that is exciting is its decentralized, Wild West nature. There’s a lot of potential upside, but this also means that there’s also a lot of potential pitfalls as well. The crypto space is filled with many unscrupulous characters looking to scam people out of their hard-earned money. Law enforcement in Texas caught up with one such scalawag, the CEO of AriseBank, Jared Rice Sr.
AriseBank a Total Scam
Rice was arrested by the FBI for his ambitious fraudulent scheme concerning AriseBank and its supposed virtual currency, AriseCoin. Rice touted AriseBank as the “first decentralized banking platform” that would offer full banking services.
As such, the “bank” would feature traditional banking accounts, full FDIC protection, cryptocurrency services, and credit and debit cards through Visa. The platform would run on the AriseCoin cryptocurrency, and Rice bragged that the platform’s ICO had raised $600 million within just a few short weeks.
The reality was far different. He did raise $4.25 million from investors who paid with Bitcoin, Litecoin, and Ethereum. However, the supposed bank had no relationship with Visa, was not licensed by the state of Texas to operate, and was not insured by the FDIC.
Facing a Lot of Prison Time
Rice took the investors’ funds and spent it on a lavish lifestyle. He used the money for clothing, Uber rides, food, hotels, and even a family attorney. He also supposedly spent some of the money on his girlfriend.
Jared Rice Sr. is now facing three counts each of wire fraud and securities fraud. Compounding his legal woes is the fact that while he was promoting his cryptocurrency scam, he did not disclose that he had previously pleaded guilty to state felony charges in association with an internet scheme.
If Rice is convicted on all counts, he faces up to 120 years in prison.
It pays to do due diligence before investing in a project. Fraud is far too common in the cryptocurrency space. Authorities are cracking down, such as one illegal Bitcoin trader getting sentenced to 15 months in prison. The SEC just came to terms with Floyd Mayweather and DJ Khaled for their part in promoting a fraudulent ICO without disclosing the fact they were compensated for their actions.
Do you think the crypto scammer in Texas should get 120 years in prison? Let us know in the comments below.
Images courtesy of Shutterstock.
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