The law comes after crypto fraudsters once again, with two scammers being sentenced to three years in prison for stealing $1.9 million from their buyers. "Investment management service" Dropil was found to have cheated its 2,000 customers by promising them access to a trading bot, despite not having one that functioned as advertised. Buyers who lost out had invested in Dropil's DROP token, having been promised a financial return of up to 63 percent. When put under pressure from regulators, project leads falsified reports and lied under oath. They have now pleaded guilty to securities fraud, and will serve combined five-and-a-half years in prison. Jeremy David McAlpine was hit with the longest sentence, and will serve 36 months in federal prison (thanks, Web3 is going great). Zachary Michael Matar was hit with a 30-month sentence for his part in the project. McAlpine and Matar plead guilty to securities fraud back in 2021, admitting they lied to investors over what they would get in return for buying their DROP token.Customers were promised access to "Dex" - a trading bot that would help them achieve returns between 24 and 63 percent. These figures were found to be false when investigated by regulators.
Speaking on the sentencing, prosecutors condemned McAlpine and Matar's actions. "They caused significant financial harm to an extremely large number of victims", prosecutors commented. "[They] entailed efforts to derail law enforcement’s attempts to root out and address wrongdoing."
McAlpine and Matar are far from the only crypto project leads to face legal repercussions. As we reported recently, the US is cracking down on Web3 scams, with one defendant facing 115 years in prison if found guilty. Another is facing 40 years in prison, having allegedly cheated investors out of $2.6 million.