Jared Rice, Snr, the Chief Executive Officer of AriseBank, got a sentence to serve a jail term in the United States federal prison up to five years for a fraudulent crypto scheme worth $4 million. The Department of Justice of the United States made this known in a statement published on August 25. Jared Rice is well-known for the invention of AriseCoin. The firm, AriseBank, became the pioneer decentralized banking system in the world based on an exclusive cryptocurrency, AriseCoin.
The 33-year-old began indicting society with his AriseCoin. The United States Securities and Exchange Commission Office in Fort Worth filed it in 2018. Afterward, in March 2019, he acknowledges the fraud charges against him. This eventually led to a five-year jail term and a payment of 4,258,073 USD in restitution.
The Crypto Scheme Organized by Jared Rice
In the plea papers written by the convict, he admitted to lying to his potential investors. In the business proposal he offered to them, he said the AriseBank would its users FDIC-insured accounts, including other traditional banking services. In addition to this, he promised credit cards branded by Visa. All of these offers listed are in addition to the crypto services, which serve as the fundamental offering of the firm.
However, the firm was not licensed to offer such services in the United States, neither does the FDIC are aware of the acclaimed partnership with the firm. Adding to it, Visa denied holding any talks with the first for the productions of credit cards.
The statement from the Department of Justice stated that “despite the claims of the nonexistent benefits from the AriseBank, the CEO diverted the investor funds to his account lavishing them on luxurious hotels, extravagant lifestyle including transportation, food, expensive law attorney. He, however, hid these facts from the investors and also failed to reveal to them that he pleaded guilty to the charges from the Department of Justice sometimes back.”
Through the scheme, hundreds of investors acquired the Arisecoin worth $4.25 million through fiat currency and digital assets, including Bitcoin, Litecoin, and Ethereum.
When the CEO pleaded guilty back in 2019, Nealy Cox, a U.S. Attorney, said, “As a person, I am proud of the innovative work of the Northern District of Texas in enforcing the accurate rule of law in the crypto space. We will try everything we could to ensure investors’ protection.”