Manhattan U.S. Attorney And FBI Assistant Director Announce Securities And Wire Fraud Charges Against Texas Man For Running Bitcoin Ponzi Scheme
Nov 6, 2014 · Sourced to the U.S. Department of Justice
Preet Bharara, the United States Attorney for the Southern District of New York, and George Venizelos, the Assistant Director-in-Charge of the New York Field Office of the Federal Bureau of Investigation (“FBI”), announced today that TRENDON SHAVERS, a/k/a “pirateat40,” was arres
Defendants
- Trendon Shavers — age 32 · McKinney, Texas · arrested
Charges
Securities fraud
Max: 20 years in prisonTrendon Shavers· charged
Wire fraud
Max: 20 years in prisonTrendon Shavers· charged
Financial actions
- fine: $5 million — Maximum fine for securities fraud count, or twice the gross gain or loss from the offense
- fine: $250,000 — Maximum fine for wire fraud count, or twice the gross gain or loss from the offense
- disgorgement: more than $40 million — Disgorgement and prejudgment interest ordered in separate SEC civil action related to BCS&T
- fine: $150,000 — Civil penalty related to BCS&T ordered in separate SEC civil action
From the announcement
“As alleged, Trendon Shavers managed to combine financial and cyber fraud into a Bitcoin Ponzi scheme that offered absurdly high interest payments, and ultimately cheated his investors out of their Bitcoin investments. This case, the first of its kind, should serve as a warning to those looking to make a quick buck with unsecured currency.”
“Shavers used a new currency, but the same old reprehensible tricks. He claimed to offer a Bitcoin market-arbitrage strategy. In reality, it was nothing more than an insidious scheme motivated by greed. Today, Shavers' jig is up. He finds himself under arrest and charged in Manhattan federal court.”
Investigating agencies
Case details
- Prosecuting office
- Southern District of New York
- Assets
- Bitcoin
Primary source
Every fact above is drawn from the Department of Justice's own announcement — a public-domain government record.
Read the original DOJ release →This is a research and reference page compiled from public DOJ announcements, not legal advice. Details reflect the government's statements as of its release date and may not capture later developments such as appeals, dismissals, or overturned convictions. Defendants are presumed innocent unless and until proven guilty.