AML Bitcoin Promoters Slammed with Wire Fraud and Money Laundering Charges

The Department of Justice (DOJ) has hit another figure in the cryptocurrency industry with charges of money laundering. This week, the DOJ published a document to the United States District Court for the Northern District of California. As the document showed, the Department had charged Rowland Marcus Andrade, a Texas resident, for conducting an Initial Coin offering (ICO) for a fake cryptocurrency.

Scamming Investors at the Height of the Crypto Boom

As the Department’s document alleges, Andrade founded the NAC Foundation, a crypto company, and conducted an ICO for a digital asset, dubbed AML Bitcoin. The suspect allegedly told investors that his company’s digital asset would eventually be converted into “actual AML Bitcoin.”

The filing pointed out that the NAC Foundation had claimed in its whitepaper that AML Bitcoin would allow the original Bitcoin asset to comply with federal anti-money laundering (AML) and know-your-customer (KYC)regulations. The company also reportedly touted the asset’s ability to incorporate “biometric technologies,” amongst other methods, to identify participants in asset-based transactions.  

A press release from the company back in 2018 also promoted the asset as “the world’s only patent-pending digital currency with anti-money laundering, know-your-customer, anti-terrorism, and theft-resistant properties.”

According to a separate complaint filed by the Securities and Exchange Commission (SEC), the company conducted its ICO in late 2017 and early 2018. It raised $100 million to help develop the asset, with Andrade himself raising about $5.6 million from over 2,000 investors.

The DOJ also accused Andrade and his colleagues of making false public statements to woo investors. The partners reportedly lied about the asset’s development level, created fake “rejection campaigns,” and even indicated to investors that they were working with the government on developing an AML and KYC-compliant digital asset.

Aggressive Promotion for a Scam Asset

The partners even went as far as claiming that they had an ad with the National Football League. As the DOJ’s report explained: 

 “Andrade, NAC Foundation and his associates claimed that the advertisement would have aired during the Super Bowl if the television network airing the Super Bowl and the National Football League had not rejected the advertisement as being too controversial.”

In truth, the company didn’t even have the funds to purchase ad spots for the Super Bowl. So, the NFL never even had the chance to review and reject the ad because the Foundation didn’t submit one.

Asides from the false claim, the NAC Foundation also claimed to have had meetings with an elected official in California and the Panama government. While Andrade had attended a roundtable discussion with an elected California government official, the DOJ confirmed that they never spoke about AML Bitcoin. 

Apart from Andrade, the SEC also charged Jack Abramoff, a famous Washington D.C insider and lobbyist, for promoting the scam digital asset. While the DOJ’s indictment mentioned a “co-schemer” with Andrade, the SEC’s filing mentioned the lobbyist.

Abramoff has an extended rap sheet, having done prison time for corruption between 2006 and 2010. He and Andrade now face one count each of money laundering and wire fraud. Both counts carry up to 20-year sentences.