Disgraced lobbyist Jack Abramoff is heading back to jail after he pleaded guilty to defrauding several thousand people out of millions of dollars by pushing what he claimed was a new, better, Bitcoin.
The man who became a byline for Washington DC corruption, after he was sentenced to six years in prison for bribing public officials while representing casino interests in 2006, seems not to have learned his lesson.
He has now admitted charges of conspiracy, fraud, and violating a new measure in the Lobbying Disclosure Act. With no short measure of irony, Abramoff is the first person to be prosecuted under the measure that was introduced because of his own previous criminal behavior.
“Abramoff was aware of the obligations to register as a lobbyist in part because Congress amended provisions of the Lobbying Disclosure Act in 2007 in part as a reaction to Abramoff’s past conduct as a lobbyist,” court documents [PDF] noted.
Here's the Bitcoin scam that put him on the prosecutors’ radar: Abramoff and his alleged co-conspirator Rowland Andrade, persuaded roughly 2,400 investors to give them $5.6m for tokens that they claimed would later be converted to what they called “AML Bitcoin.”
AML Bitcoin was heavily marketed as a safer, better alternative to Bitcoin as it would include protections against money laundering, theft and terrorism funding. But the Securities and Exchange Commission (SEC) took a look at the digital currency and concluded the protections were simply made up. It has launched its own lawsuit against the National AtenCoin Foundation run by Abramoff and Andrade.
Andrade has pleaded not guilty to the charges laid against him, and has claimed he is a “victim of government corruption.”
The NAC Foundation started selling tokens in order to raise funds to launch AML Bitcoin back in 2017, telling investors that they would be converted into the new digital currency when it was up and running. Prosecutors claim Andrade hired Abramoff to do public relations and marketing, paying him $220,000 for the first year of work.
Abramoff created what prosecutors say was a fiction around the product, claiming it would use biometrics to add an extra layer of security and safety. The technology didn’t exist but that didn’t stop Abramoff from paying people to write op-eds saying it did, without disclosing they had been paid to do so.
AML Bitcoin launched in October 2017 and prosecutors say that Abramoff and Andrade promised that the millions of dollars in tokens would be converted within six months. Some of the $5.6m raised was spent on personal items, say prosecutors.
At the same time as the Bitcoin scam, Abramoff was representing a cannabis company based in California and lobbied a member of Congress on their behalf without registering as a lobbyist. He was caught in an FBI sting when an agent posed as a businessman and asked him to lobby another member of Congress, which he did, and admitted to this week.
The admission of criminal conduct comes after Abramoff made great show of how he had gone straight after he emerged from jail, having served four of his six years for corruption, in which he ripped off Indian tribes that had hired him to push their casino interests in Washington.
Abramoff even wrote a book about his exploits. He faces up to five years for the latest crop of crimes he’s admitted to, meaning that a sequel to his tale should be available in 2025 some time. ®