BROOKLYN, NY – Earlier today in a Brooklyn federal court, Rashawn Russell pleaded guilty to participating in a scheme to defraud R customers.3 Crypto Fund, a purported cryptocurrency investment fund managed by Russell. Russell also pleaded guilty for his role in a separate identity theft scheme in which he fraudulently obtained credit cards and other access devices in the names of third parties. Today’s plea took place before U.S. Magistrate Judge Sanket J. Bulsara. Once convicted, Russell faces up to 30 years in prison. As part of his plea agreement, Russell will have to pay restitution in the amount of more than $1.5 million.
Breon Peace, United States Attorney for the Eastern District of New York; Nicole M. Argentieri, Acting Assistant Attorney General for the Justice Department’s Criminal Division; and Eric Shen, Inspector in Charge of the United States Postal Inspection Service, Criminal Investigation Unit (USPIS), announced the guilty plea.
“Russell exploited investor interest in cryptocurrency markets to perpetrate a scheme to defraud customers who trusted him,” said U.S. Attorney Breon Peace. “The swift conviction in this case underscores this office’s commitment to holding bad actors in digital asset markets accountable.”
“The Postal Inspection Service is proud to protect Americans from ever-evolving fraud threats,” said USPIS Inspector-in-Charge Shen. “This case demonstrates our determination to bring to justice those who violate their fiduciary duty to their clients. »
According to court filings and facts presented at the plea hearing, between November 2020 and August 2022, Russell, a former investment banker and broker registered with the Financial Industry Regulatory Authority, engaged in a scheme to defraud investors in his R.3 Crypto Fund by falsely promising that, among other things, it would use its funds to make cryptocurrency investments that would earn significant, and sometimes guaranteed, returns. In truth, much of the investors’ assets were misappropriated by Russell and used for his personal gain, to gamble and repay previous investors. Thanks to Russell’s scheme, at least 29 investors lost at least $1.5 million.
In a separate fraudulent scheme, between September 2021 and June 2023, Russell fraudulently obtained more than fifteen credit cards and other access devices in the names of third parties. Russell obtained these devices with the intent of using them to make unauthorized transactions.
The government’s case is being handled by the Corporate and Securities Fraud Section of the United States Attorney’s Office for the Eastern District of New York and the Department of Justice’s Criminal Division, Fraud Section. Assistant United States Attorney Drew Rolle, Prosecutor Kyle Crawford and Chief Deputy Scott Armstrong are prosecuting the case.
If you believe you are a victim in this case, please contact the Fraud Section’s Victim and Witness Unit at toll-free (888) 549-3945 or by email at [email protected].
Age: 27 years old
Brooklyn, New York
EDNY file number.