A U.S. federal judge has sentenced two former leaders of Cred, the bankrupt cryptocurrency lending company, to nearly 8 years in prison for conspiring to defraud customers. Daniel Schatt, co-founder and CEO, received 52 months in prison, while CFO Joseph Podulka was sentenced to 36 months. Both admitted to concealing Cred's poor financial condition and secretly funneling 80% of customer assets into risky loans for Chinese gamers.
When the cryptocurrency market crashed in 2020, the collapse plan caused over 440,000 customers to lose 140 million USD, now estimated to exceed 1 billion USD. Besides prison sentences, each person is also required to pay a fine of 25,000 USD and face three years of probation after serving their sentence.
According to legal expert Ishita Sharma, the Cred case demonstrates that courts are increasingly tightening the responsibilities of leaders in cryptocurrency fraud cases, emphasizing the scale of the damage and the level of betrayal of customer trust.
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The former CEO of Cred was sentenced to federal prison for a $150 million cryptocurrency fraud.
A U.S. federal judge has sentenced two former leaders of Cred, the bankrupt cryptocurrency lending company, to nearly 8 years in prison for conspiring to defraud customers. Daniel Schatt, co-founder and CEO, received 52 months in prison, while CFO Joseph Podulka was sentenced to 36 months. Both admitted to concealing Cred's poor financial condition and secretly funneling 80% of customer assets into risky loans for Chinese gamers.
When the cryptocurrency market crashed in 2020, the collapse plan caused over 440,000 customers to lose 140 million USD, now estimated to exceed 1 billion USD. Besides prison sentences, each person is also required to pay a fine of 25,000 USD and face three years of probation after serving their sentence.
According to legal expert Ishita Sharma, the Cred case demonstrates that courts are increasingly tightening the responsibilities of leaders in cryptocurrency fraud cases, emphasizing the scale of the damage and the level of betrayal of customer trust.