Three former executives of bankrupt crypto lender Cred face wire fraud and money laundering charges

Three former executives of now-bankrupt cryptocurrency lender Cred have been charged with wire fraud and money laundering for allegedly engaging in wire fraud and money laundering before declaring bankruptcy in November 2020. “This indictment demonstrates our commitment to protecting our markets from fraudsters and keeping investors safe,” the U.S. Attorney’s Office for the Northern District of California said in a statement on May 3. Former CEO Daniel Schatt and CFO Joseph Podulka face 13 counts of wire fraud and money laundering, and former COO James Alexander is charged with four counts. “This highlights a predatory, deceptive scheme that involved defrauding potential victims of hundreds of millions of dollars in cryptocurrency,” said Mark Mosley, acting special agent in charge of IRS Criminal Investigation. Prosecutors allege that the three executives misled customers about Cred’s lending and investing practices. Cred claimed to only engage in “collateralized or secured lending,” that Cred’s cryptocurrency investments were “hedged,” and that Cred maintained a “24/7 approach” to investments to protect against volatility. However, prosecutors allege that Cred engaged in lending that was “neither collateralized nor secured.” (Cointelegraph)