My Big Coin Founder Convicted of $6 Million Cryptocurrency Fraud Scheme

Randall Crater, the founder of My Big Coin Pay Inc. (My Big Coin), a purported cryptocurrency and virtual payment services company headquartered in Las Vegas, Nev., was convicted by a federal jury in connection with a scheme to defraud investors by marketing and selling fraudulent virtual currency. 

Crater was convicted of four counts of wire fraud, three counts of unlawful monetary transactions, and one count of operating an unlicensed money transmitting business. U.S. District Court Judge Denise J. Casper scheduled sentencing for Oct. 27, 2022. Crater was arrested and charged in February 2019.

Crater founded My Big Coin in 2013, offering virtual payment services through a fraudulent digital currency, "My Big Coins," which he marketed to investors between 2014 and 2017 using misrepresentations about the nature and value of Coins. Crater and his associates falsely claimed that Coins were a fully functioning cryptocurrency backed by $300 million in gold, oil and other valuable assets. Crater also falsely told investors that My Big Coin has a partnership with MasterCard and that Coins could readily be exchanged for government-backed paper currency or other virtual currencies. Crater promulgated these misrepresentations through social media, the internet, email and text messages.

In reality, Coins were not backed by gold or other valuable assets, did not have a partnership with MasterCard and were not readily transferable. Over the course of the scheme, Crater misappropriated over $6 million of investor funds for his own personal gain and spending on goods, including hundreds of thousands of dollars' worth of expenses on antiques, artwork and jewelry.

In January 2018, the Commodity Futures Trading Commission (CFTC) announced commodity fraud charges against Crater and My Big Coin Inc. The CFTC also filed civil charges against the Chief Executive Officer of My Big Coin, John Roche, and two of Crater's associates Mark Gillespie and Michael Kruger. The civil action was stayed on March 8, 2019, pending resolution of the criminal case.

The charge of wire fraud provides for a sentence of up to 20 years in prison, three years of supervised release and a fine of $250,000, or twice the gross gain or loss. The charges of unlawful monetary transactions provide for a sentence of up to 10 years in prison, three years of supervised release and a fine of $250,000, or twice the value of the criminally derived property. The charge of operating an unlicensed money transmitting business provides for a maximum sentence of five years in prison, three years of supervised release and a fine of $250,000, or twice the gross gain or loss.