ALLEGED $1.8M CRYPTO SCAM
Between March 2019 and September 2021, officials say Chester “Chet” Stojanovich has made himself a seller of crypto mining equipment, convincing his potential customers to pay for large-scale mining equipment and mining services, Stojanovich has promised to set up a location in Goose Bay in Newfoundland and Labrador.
According to the complaint, Stojanovich did not live up to his promises and kept a large portion of his money for himself.
Stojanovich is not the first person to be accused of carrying out a massive scam involving crypto mining machines. In 2020, a 60-year-old California man was arrested and charged with running a series of schemes, including the operation of fake crypto mines that cost five investors $ 550,000, part of which he spent on casinos, restaurants and hotels. .
Stojanovich's alleged fraud with small potatoes compared to other crypto mining grifts. The popular BitClub Ponzi scheme swindled $ 722 million investors over five years, aimed at selling unscrupulous investors in non-crypto mining shares to fraudulent investors - in order to get them back from new investors.
But unlike BitClub, Stojanovich's scam was not a Ponzi scheme - it was an old scam. He is accused of embezzling large sums of money from his clients by chartering private planes and private cars, paying more than $ 80,000 on credit card debt, having luxurious parties and giving his wife money.
According to the complaint, Stojanovich and his subordinates, including Chet Mining, Chet Mining Canada and Phoenix Data LLC, have told investors that he will buy mining equipment on their behalf and host the equipment at the Goose Bay facility at a fixed number. of months.
However, the FBI says that Stojanovich did not buy equipment as promised, but instead "used deceptive tactics to create the impression that such miners were found and were accused of giving hash power to [his] clients' accounts."
Stojanovich allegedly bought a total of S9 miners from Amazon, as well as two other miners on eBay, who used it extensively as resources in the system. (He took payment from customers of about 1,500 S9 miners and over 1,500 L3 miners.)
When his clients began to suspect and ask for proof of purchase, Stojanovich sent them photos of the miners he had purchased, as well as photographs of him standing next to piles of boxes, according to the complaint.
In another incident, an unnamed customer who ordered 912 S9 miners from Stojanovich insisted that Stojanovich provide proof of purchase, including "serial numbers, insurance documents or shipping documents." When Stojanovich was unable to provide proof, the customer demanded that he be taken to the so-called host city in Goose Bay - a 31-hour drive from New York City - to see for himself his purchase.
According to the FBI, Stojanovich also admitted that on the weekend of Memorial Day 2019, he and a customer found a rented car and headed for Goose Bay. However, things went awry between the two as they approached the Canadian border, with Stojanovich reportedly telling a customer he could not see the miners.
The FBI reports that “the trip abruptly ended in Buffalo, New York, when Stojanovich left [the customer] at the airport and stated with half the facts that he would not be reimbursed.”
A former Stojanovich employee told the FBI that, when his boss returned from a trip, he admitted that he had never bought S9 miners from a customer who had paid them.
Stojanovich allegedly continued to use images and counterfeit evidence of non-existent hash power to appease troubled customers, but in September 2019 he stopped responding to all texts and emails.
Two months later he woke up again and told customers that the owner of the site on which Goose Bay was allegedly having an affair had fled with their equipment.
Cases and other allegations of fraud
In June 2020, six of Stojanovich's alleged victims filed a lawsuit against him and his two companies, alleging "public RICO breach, contract breach, fraud, conversion and misappropriation."
According to the FBI, however, the indictment did not prevent Stojanovich from attempting his hand in the second round. Between August and September 2021, Stojanovich convinced three sellers representing customers interested in buying mining equipment to pay him about $ 200,000 to a total of 127 miners.