A US grand jury has indicted the founder of blockchain startup Amalgam Capital Ventures over allegations he defrauded investors out of over $1 million with a fake blockchain.
Jeremy Jordan-Jones was arrested and indicted on May 21 and charged with wire fraud, securities fraud, making false statements to a bank, and aggravated identity theft, the Department of Justice said on May 21.
Manhattan US Attorney Jay Clayton claimed Jordan-Jones “touted his company as a groundbreaking blockchain startup,” but alleged that, in reality, the “company was a sham, and investors’ funds were siphoned off to bankroll his lavish lifestyle.”
FBI Assistant Director Christopher Raia alleged that Jordan-Jones defrauded investors of more than 1 million dollars through “misrepresentations of his purported company’s capabilities, partnerships, and investment intentions.”
Raia claimed the Amalgam founder’s “blatant lies” funded his personal lifestyle at the expense of unknowing victims.
According to an indictment filed in a Manhattan federal court, from January 2021 to November 2022, Jordan-Jones deceived investors and financial institutions using fabricated documents, fake sports partnerships, and misleading claims, ultimately misappropriating over $1 million for personal use.
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Amalgam claimed to offer point-of-sale systems and blockchain-based payment and security solutions, the filing states.
The indictment alleged the firm had “no operable products, few, if any, customers, and zero legitimate business partnerships.”
The filing alleged that instead of channeling the funds into tech development and crypto exchange listings as promised, Jordan-Jones spent the money on luxury vehicles, high-end vacations, clothing and fancy restaurants in Miami.
Charges carry decades in prison
Jordan-Jones was also accused of submitting a fake bank statement claiming Amalgam held over $18 million in order to secure a company credit card, but prosecutors claimed there were no funds in the bank account and it had been closed in late 2021.
Wire fraud and security fraud carry potential penalties of up to 20 years in prison per count, while making false statements to a bank carries up to 30 years.
Jordan-Jones was also charged with one count of aggravated identity theft, which carries a mandatory sentence of two years in prison.
The government is seeking forfeiture of any property or money traceable to the fraud, including substitute assets if the original funds are unavailable.
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