NEW ORLEANS U.S. Attorney Duane A. Evans announced thatMICHAEL YUSKO, III, age 46, a resident of New Orleans, pleaded guilty today to operating an unlicensed money transmitting business before U.S. District Judge Barry W. Ashe.
According to court documents, federal agents received complaints beginning in May 2018 thatYUSKOwas selling customers bitcoin and other cryptocurrencies but failing to follow through on transactions.YUSKOwould promise customers any amount of bitcoin in exchange for U.S. dollars at five percent above market price for a five percent fee. He then directed these customers to deposit U.S. dollars into one of several business bank accounts, among them Nervous Light Capital LLC, Ready Demolition LLC, Patriot Concrete Pumping, LLC, Praetorian Energy, LLC, and Hudson Oak Partners LLC.YUSKOdid not register these companies as money transmitting businesses with Financial Crimes Enforcement Network (FinCEN) of the Department of Treasury, and he otherwise did not comply with the regulations of Title 31, United States Code, Section 5330.YUSKOalso instructed his clients not to tell any bank employees that the purpose of their wire transfer was to purchase cryptocurrency. Agents have learned that banks frequently shut down accounts used to sell cryptocurrency, and banks had previously shut downYUSKOs accounts for such activity.
The court documents detail how customers communicated withYUSKOand paid him tens of thousands of dollars for bitcoin. WhileYUSKOdid carry out transactions with many customers, he failed to fulfill other transactions, and then he failed to return the U.S. dollars deposited in his accounts.YUSKOadmitted to being responsible for $201,399.00 in losses to victims. As part of his plea,YUSKOagreed to make full restitution.
YUSKOfaces a maximum of five years in prison, a maximum $250,000.00 fine, up to three years of supervised release, and a $100 mandatory special assessment. Judge Ashe scheduledYUSKOs sentencing for November 4, 2021.
U.S. Attorney Evans praised the work of the Federal Bureau of Investigation New Orleans Field Office and the U.S. Secret Service New Orleans Field Office. Assistant United States Attorney Matthew R. Payne is in charge of the prosecution.
Source: U.S. Secret Service