Pablo Rodriguez, the co-founder of the cryptocurrency pyramid scheme AirBit Club, was charged with wire fraud conspiracy in March and pleaded guilty, receiving a sentence of 12 years in jail. Rodriguez and his accomplices were charged with directing a global fraud, luring investors with fictitious claims of cryptocurrency riches, misusing their funds for personal advantage, and making excuses when withdrawal requests were made. Rodriguez will have an additional three years of supervised release after serving a 12-year prison sentence, per the ruling of District Court Judge George B. Daniels.
In 2015, Rodriguez and Dos Santos created AirBit Club and carried out a fraud that stole over $100 million. The pair persuaded their victims to participate in AirBit Club by providing a profit guarantee in return for monetary contributions towards club “memberships.” As a bitcoin multilevel marketing club, AirBit Club promised members daily passive returns as well as profits from trading and mining cryptocurrencies. Rodriguez, Dos Santos, Hughes, Millan, and Chairez travelled all over the world to market the scheme, staging lavish expos and local presentations to convince victims to purchase AirBit Club memberships, including in the Southern District of New York.
Victims were given access to a website that purportedly showed gains growing, however it was later discovered that no actual bitcoin activity on the part of the victims had taken place, hence these claims were false. Instead, the criminals “enriched themselves,” using user money to buy expensive goods while enlisting new victims at opulent expos. Victims who attempted to withdraw money from the AirBit Club Online Portal and reported their experiences to promoters frequently encountered delays, excuses, and hidden fees totaling more than 50% of their requested withdrawals. Some of them allegedly lost their major investments and had their accounts frozen owing to a bogus claim regarding the COVID-19 epidemic.