Former Deutsche Bank executive sentenced to 30 years for crypto fraud

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Former Deutsche Bank executive sentenced to 30 years for crypto fraud

In a significant development, Rashawn Russell, a former executive of Deutsche Bank (ETR: DBKGn ), was sentenced to 30 years in prison for his involvement in a cryptocurrency fraud scheme. The US Department of Justice (DOJ) detailed the case in a press release, outlining Russell's guilty plea and the nature of his fraudulent activities.

Russell admitted to defrauding clients of the R3 Crypto Fund, a supposed cryptocurrency investment fund he operated. He also confessed to a separate identity theft scheme where he fraudulently obtained credit cards and access devices in the names of third parties. The court ordered Russell to pay restitution totaling over $1.5 million as part of his plea agreement.

United States Attorney for the Eastern District of New York, Breon Peace, and Eric Shen, Inspector-in-Charge of the US Postal Inspection Service, Criminal Investigations Group (USPIS), jointly announced the guilty plea. In their statements, they emphasized that Russell had exploited investor interest in cryptocurrency markets and violated his fiduciary duty to clients.

The court filings revealed that between November 2020 and August 2022, Russell made false promises about using client funds for lucrative cryptocurrency investments. Instead, he misappropriated a significant portion of these assets for personal gain, gambling, and repaying earlier investors. This fraudulent scheme resulted in at least 29 investors losing a total of $1.5 million.

In addition to the crypto fraud scheme, Russell was involved in another fraudulent activity from September 2021 to June 2023. He obtained numerous credit cards and access devices in the names of third parties with the intent to use them for unauthorized transactions.

The case is being handled by the Business and Securities Fraud Section of the United States Attorney’s Office for the Eastern District of New York, in conjunction with the Department of Justice, Criminal Division, Fraud Section.

This incident comes as Deutsche Bank, a major German banking firm, recently established a global partnership with Swiss company Taurus, specializing in digital asset infrastructure. The collaboration aims to promote further growth in the use of cryptocurrencies, allowing Deutsche Bank to utilize Taurus's technology for managing digital currencies and tokenized assets.

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