TLDR Brent Kovar was convicted of wire fraud, mail fraud and money laundering He ran Profit Connect, a company that claimed to mine crypto using AI The scheme defrauded at least 400 investors
A federal jury has convicted a Las Vegas business owner of running a $24 million crypto Ponzi scheme. Brent Kovar was found guilty on multiple counts of fraud after a nine day trial.
The verdict came down Monday. Prosecutors said Kovar defrauded at least 400 investors over several years.
Kovar owned a company called Profit Connect from late 2017 to July 2021. The Las Vegas based firm claimed to use artificial intelligence software running on a supercomputer.
The company said it used this technology to mine crypto and verify crypto transactions. Prosecutors said none of this was true.
Kovar told investors that Profit Connect was profitable. He promised fixed annual returns ranging from 15% to 30%.
He also offered a 100% money back guarantee. Kovar claimed the company held hundreds of millions of dollars in crypto reserves.
None of these claims held up, according to the Justice Department. The company was not profitable and held no such reserves.
Profit Connect had no real way to pay the returns it promised. It also had no way to honor the money back guarantee.
Instead, Kovar used investor funds to run daily operations. He also spent money on gifts for employees.
He used investor money to buy a house for himself. Kovar repaid earlier investors using funds collected from newer investors.
He presented these repayments as if they came from crypto mining profits. In reality, the money came from other victims of the scheme.
A federal jury convicted Kovar on 11 counts of wire fraud. He was also convicted of two counts of mail fraud and two counts of money laundering.
Officials from the Justice Department, FBI, IRS and FDIC each spoke about the case after the verdict. The FBI said victims believed they were investing in new technology.
Instead, they were misled by false claims about profits and reserves. The FDIC said Kovar falsely told investors his product was insured by the government agency.
Kovar is scheduled to be sentenced on November 30, 2026. He faces a statutory maximum of 280 years in prison.
That figure reflects the combined maximum penalty for all counts against him. A federal judge will decide his actual sentence.
The judge will weigh federal sentencing guidelines and other factors before ruling. This means the final sentence could end up far below the maximum.
The FBI is asking anyone with information about similar fraud to come forward. Reports can be filed through the agency’s Internet Crime Complaint Center at ic3.gov.
The post Las Vegas Business Owner Convicted in $24 Million Crypto Ponzi Scheme appeared first on Blockonomi.
