Hollywood Man Accused Of Running $25M Crypto Ponzi Scheme: DOJ

HOLLYWOOD, CA — A Hollywood Hills man is one of two people accused of running a cryptocurrency Ponzi scheme that defrauded victims of more than $25 million, the U.S. Attorney's Office said Tuesday.

The man, Vincent Anthony Mazzotta Jr., 52, and his associate, Australian national David Gilbert Saffron, 51, are accused of using the victims' funds to pay for private chartered jet flights, luxury hotel accommodations, private mansion rentals, a personal chef and private security guards, according to prosecutors.

They're each charged with conspiracy to commit wire fraud, wire fraud, conspiracy to obstruct justice, conspiracy to commit money laundering, and money laundering. Saffron is also accused of committing felonies while on pre-trial release. Their indictment was unsealed Tuesday, prosecutors said.

The men are accused of operating a scheme in which they told victims they would use an artificial intelligence trading bot to earn high-yield profits in crypto markets. They promoted the scheme under names including Circle Society, Bitcoin Wealth Management, Omicron Trust, Mind Capital and Cloud9Capital, proseuctors said.

After victims' made investments, the men solicited them to pay a fictitious entity they created — the Federal Crypto Reserve — to investigate and recover victims' losses, prosecutors said.

Saffron is accused of using various nicknames to conceal his identity, including David Gilbert, Dave Gabe, the Blue Wizard and Bitcoin Yoda, prosecutors said.

If convicted as charged, they each face a maximum penalty of 20 years in prison for each count of conspiracy to commit wire fraud and money laundering, 20 years in prison for each wire fraud count, 10 years for each money laundering count, and five years for conspiracy to obstruct justice. Saffron also faces up to 10 years in prison consecutive to any other sentence for committing felonies while on pre-trial release, according to the U.S. Attorney's Office.