IcomTech founder David Carmona was sentenced to close to 10 years in prison after prosecutors called the firm a crypto Ponzi scheme and said he “preyed upon working-class people.”
Carmona, 41, was sentenced on Friday to 121 months in prison by U.S. District Judge Jennifer L. Rochon, according to a statement released by the U.S. Attorney's Office for the Southern District of New York. Carmona previously pleaded guilty to one count of conspiracy to commit wire fraud.
Carmona started IcomTech in 2018 along with others and said it was a crypto mining and trading company. The firm promised to garner profits for investors if they bought certain “purported cryptocurrency-related investment products,” prosecutors said. That didn't happen. Instead, prosecutors say IcomTech did not participate in mining or trading for its investors and instead used the money to pay other investors and to use for themselves.
“David Carmona masterminded the IcomTech cryptocurrency Ponzi scheme, which preyed upon working-class people by promising them complete financial freedom in exchange for parting with their hard-earned money,” said U.S. Attorney Damian Williams in a statement.
Carmona and others “hosted lavish expos,” tried to get people interested in investing and bragged about how much money they were earning, prosecutors said.
“IcomTech promoters often showed up at larger-scale events in expensive cars and wearing luxury clothing as a way of exhibiting their purportedly legitimate success from IcomTech,” prosecutors said. “The atmosphere of these events was festive and designed to generate excitement about the schemes.”
However, when investors began trying to withdraw money in 2018, they were then met with excuses, delays and hidden fees.
Despite complaints, IcomTech promoters, including Carmono kept trying to promote the company and accepted investments, prosecutors said. By the end of 2019, IcomTech collapsed.
Former IcomTech CEO Marco Ruiz Ochoa was sentenced in January to five years in prison.