Former Deutsche Bank Associate Receives Jail Time for $1.5M Cryptocurrency Fraud
A Brooklyn man who once worked at Deutsche Bank as an investment banker will serve three years and five months in prison for running a crypto fraud scheme that defrauded investors of $1.5 million.
Rashawn Russell, 28, set up a company called R3 Crypto Fund and promised his clients returns of up to 100% on their cryptocurrency trades. However, instead of using the money for investments, he used it for gambling and personal expenses. He also stole money from some clients to pay others, in a Ponzi-like fashion.
Court records reveal that Russell also engaged in a separate fraud, stealing at least 140 credit, debit, and ID cards from gym lockers in New York and New Jersey. He then used the stolen cards to open online gambling accounts and make fraudulent purchases.
Financial Convincer
Leveraging his experience at Deutsche Bank, Russell convinced his victims that his crypto fund was legit. He spent six years at the bank, beginning as an investment banking analyst and later becoming an associate.
From November 2020 to August 2022, Russell convinced friends, former classmates, and ex-co-workers to invest in R3 Crypto, assuring them he could deliver returns of at least 25% in three months. But instead of investing the money, he used it for gambling and paying off earlier investors.
Russell deceitfully created fake documents to convince his investors their funds were secure. He would send them screenshots of a purported bank balance, doctored to show $355K. In reality, the account held around $35K.
As the scheme began to collapse and some of the investors asked for their money back, Russell countered by sending falsified screenshots claiming to be wire transfer confirmations, showing that he had returned their money. But in reality, there were no wire transfers.
Promising Youth
Russell immigrated to the US from Jamaica at age 15 with his family. As a teenager, he earned a scholarship to the High School of Economics & Finance NYC due to his exceptional "leadership potential." Later, he enrolled at Babson College Boston, where he was given a Gates Millennium Leadership Scholarship.
However, in a letter to Judge Hector Gonzalez, Russell shared how he had fallen to "crippling gambling and substance addiction" and deeply regretted his actions. He added, “The Holy Spirit has made me new, revitalizing my lifeless body with purpose.”
Russell was arrested in February, accused of continuing his identity theft scam after his original arrest. He has been ordered to pay his victims over $1.5 million in restitution.
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