German Crypto Firm USI Tech Founder Charged in $150 Million Fraud Scheme

Horst Jiha, the German founder of USI Tech, a crypto mining and digital asset trading platform, is facing severe legal consequences in the United States. Federal prosecutors in New York accused Jicha of organizing a fraudulent scheme who allegedly defrauded investors of approximately $150 million, according to the DOJ’s official website. This case highlights the ongoing risks and regulatory scrutiny in the cryptocurrency sector.

Jicha, 64, has been charged with multiple crimes, including securities fraud, money laundering and wire fraud. He was arrested on December 23, 2023 while trying to go on vacation in Miami. This arrest marks a significant development in a saga that has been unfolding for several years.

In 2017, Jicha stated that USI Tech is the world’s first automated bitcoin trading platform, aiming to make crypto investments more accessible to retail investors. He is aggressively promoting the platform in the United States, especially in New York and Las Vegas. However, by March 2018, when authorities began their investigation, Jicha abruptly shut down the USI online platform. This action blocked the withdrawal of about $150 million worth of crypto assets held by investors, which remain unaccounted for.

The FBI’s involvement underscores the seriousness of the allegations. James Smith, head of the FBI’s New York office, said the platform was just a facade and accused Jicha of fleeing the country with millions of investors’ money.

Jicha’s case, filed as US v. Jicha, 23-CR-342 in the US District Court for the Eastern District of New York (Brooklyn), is a stark reminder of the potential risks associated with unregulated investment platforms, especially in the volatile cryptocurrency market. The case also highlights the growing efforts of US authorities to crack down on fraudulent activities in the crypto space.

Jicha pleaded not guilty to the charges and was released on $5 million bail. His defense attorneys, Marissel Descalzo and David Tarras, have expressed their intention to vigorously defend Jicha, seeking to bring to light the facts of his involvement at USI Tech. They are intended to distinguish Jicha’s actions from those of actual “bad actors.”

This development in the crypto world is a critical reminder for investors to be careful and conduct thorough research before investing in digital assets. It also highlights the need for improved regulatory frameworks to protect investors and maintain the integrity of the crypto market.

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