STUART, Fla. — One Stuart man and two others have been indicted by a South Florida federal grand jury in connection with a global cryptocurrency-based fraud, authorities said Thursday.
Joshua David Nicholas, 28, of Stuart, Emerson Pires, 33, and Flavio Goncalves, 33, both of Brazil, are facing several charges for misleading investors and generating around $100 million in revenues.
According to the indictment, Pires and Goncalves founded "EmpiresX," a cryptocurrency investment platform where Nicholas was the "Head Trader."
Officials said the three men fraudulently promoted EmpiresX and misled investors about a purported proprietary trading “bot” that they claimed could generate guaranteed returns to investors in EmpiresX.
The indictment says Pires and Goncalves then laundered investors’ funds through a foreign-based cryptocurrency exchange. The duo then paid out early EmpiresX investors with money obtained from later investors in a Ponzi-style scheme.
Juan Antonio Gonzalez, U.S. Attorney for the Southern District of Florida, said "Our office is committed to protecting investors from sophisticated scammers seeking to capitalize on the relative novelty of digital currency. As with any emerging technology, those who invest in cryptocurrency must beware of profit-making opportunities that appear too good to be true.”
The case is being investigated by the Federal Bureau of Investigation, FBI, and Homeland Security Investigations, HSI.
“The technology has changed, but the crime remains the same,” said George L. Piro, Special Agent in Charge of FBI Miami. “Unscrupulous fraudsters are nothing new to the investment world - what’s changing is they are now pushing their criminal activity into the cryptocurrency realm. Investors beware. Conduct your due diligence before investing. The FBI would like to commend Homeland Security Investigations for their close cooperation on this case.”
HSI Miami Special Agent in Charge Anthony Salisbury said the agency will pursue anyone who uses these types of schemes to victimize "would-be customers."
All three men have been charged with one count of conspiracy to commit wire fraud and one count of conspiracy to commit securities fraud.
The indictment also charges Pires and Goncalves with conspiracy to commit international money laundering.