Ex-Beverly Hills Attorney Faces $14M Restitution for $9.5M Crypto Ponzi Scheme
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An 85-year-old disbarred Beverly Hills attorney has been ordered to pay $14 million in restitution for his role in a $9.5 million cryptocurrency Ponzi scheme. On Monday, a U.S. judge ordered an 85-year-old disbarred attorney from California to pay $14 million in restitution for his involvement in a $9.5 million cryptocurrency Ponzi scheme. The attorney, David Kagel, who previously practiced law in Beverly Hills, admitted his guilt in May, pleading guilty to one count of conspiracy to commit fraud. In the Las Vegas case, U.S. District Judge Gloria Navarro sentenced Kagel to five years of probation and heavy fines. The sentence emphasizes the gravity of Kagel’s role in the fraud, which exploited naïve investors. Prosecutors revealed that Kagel played a crucial part in promoting the fraudulent investment scheme. He issued letters using the letterhead of his firm while working as an attorney, providing victims with a fictional sense of security and legality. As a result of these letters, many people invested their money under false pretenses, fostering trust in the plan. According to a Reuters report, victims believed the program was backed by trading bots that would invest in cryptocurrency on their behalf. They were further misled by Kagel’s claim of holding $11 million in escrow, which falsely guaranteed the safety of their investments. The scheme capitalized on these fabricated assurances, causing significant financial harm to the victims. In 2023, Kagel’s legal career came to a definitive end. The California Supreme Court revoked his license after he failed to address disciplinary charges. Records show that he had misappropriated $25,000 in client funds, which he used to further the Ponzi scheme. Kagel misappropriated a large amount of the victims’ money. Rather than investing the funds, he used them for personal indulgences, such as renting a private chef, a private security service,…
Filed under: News - @ October 10, 2024 4:25 am