86-year-old David Kagel, a former California attorney, has been sentenced to a five-year probationary period and ordered to pay nearly $14 million in restitution after admitting to orchestrating a crypto Ponzi scheme.
Kagel’s guilty plea in May for conspiracy to commit commodity fraud was followed by the judgement on October 8 by Judge Gloria Navarro in a federal court in Las Vegas.
Currently, Kagel is receiving hospice care as a result of his health issues. He will complete his probation at a senior facility in Las Vegas. From December 2017 to June 2022, prosecutors accused him of defrauding investors by falsely representing that they were investing in a legitimate cryptocurrency trading venture that guaranteed high returns without risk. However, it is reported that Kagel and his accomplices collected approximately $15 million from victims.
Kagel utilised his law firm’s letterhead to compose deceptive letters that were intended to foster trust with prospective investors. In order to reassure investors, he made a false claim that he possessed 1,000 Bitcoins, which were valued at $11 million.
The California Supreme Court revoked his law license in 2023 for neglecting to respond to disciplinary allegations, which included misappropriating client funds.
Two of his co-defendants, Vincent Mazzotta and David Saffron, have entered pleas of not guilty and are currently awaiting trial in Los Angeles in April of next year.
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