David Kagel, a disbarred California attorney, was sentenced to pay $14 million in restitution for running a Bitcoin Ponzi scheme between 2017 and 2022. Kagel, who promised investors high returns using fake Bitcoin holdings, will serve probation at a Las Vegas care facility. His co-conspirators await trial in 2025, highlighting the rise in cryptocurrency investment fraud.
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Legal Implications:
David Kagel’s case underscores the ongoing issue of fraudulent cryptocurrency schemes targeting vulnerable investors. The legal implications for Kagel are severe, involving the loss of his law license (revoked in 2023), restitution payments, and five years of probation. His case is part of a growing trend in which crypto fraudsters exploit the rapidly evolving digital asset space. Kagel's accomplices, still awaiting trial, may face even more significant penalties if convicted, further reinforcing the legal system’s pursuit of accountability in crypto fraud cases.
David Kagel, an 86-year-old disbarred California lawyer, has been sentenced to five years of probation and ordered to pay $14 million in restitution after pleading guilty to conducting a multimillion-dollar Bitcoin Ponzi scheme. Operating from 2017 to 2022, Kagel and two accomplices defrauded investors through false promises of high returns and secure investments backed by non-existent Bitcoin holdings. Kagel's poor health will allow him to serve his sentence at a Las Vegas senior care facility. His law license was previously revoked in 2023. His accomplices, David Saffron and Vincent Mazzotta, are awaiting trial in April 2025. This case highlights the increasing sophistication of cryptocurrency-related Ponzi schemes and the continued enforcement actions by U.S. authorities to prosecute such fraudulent activity.
