Crypto fund founder convicted over fake trading bot
- A federal jury convicted Block Bits Capital founder Japheth Dillman of wire fraud and conspiracy.
- Prosecutors said Dillman raised nearly $1 million using claims about a working automated trading system.
- Dillman is due to be sentenced on December 8 and faces up to 20 years per count.
A federal jury in San Francisco convicted Japheth Dillman of wire fraud and conspiracy, according to the US Justice Department.
Dillman founded cryptocurrency trading fund Block Bits Capital and raised nearly $1 million from more than 20 investors.
Prosecutors said Dillman claimed the fund used working automated trading software called Autotrader.
The software did not function, and prosecutors said Dillman knew it was not operational.
Dillman and an unnamed co-conspirator used investor money for personal payments and speculative cryptocurrency ventures.
Those investments suffered losses, while Dillman told investors that the fund had generated profits.
Dillman remains free on bond and is scheduled for sentencing on December 8, with each count carrying a maximum 20-year prison term.
