The U.S. Department of Justice (DOJ), announced that Gutemberg Dos Santos, a citizen of Brazil and the United States, was extradited from Panama on November 25, 2020. Dos Santos is charged by indictment with co-defendants Pablo Renato Rodriguez, Scott Hughes, Cecilia Millan, Karina Chairez, and Jackie Aguilar for running the international crypto fraud scheme and money laundering operations around the notorious AirBit Club, a fraudulent MLM Crypto Ponzi scheme. Dos Santos was arrested on August 18, 2020, in Panama City. Rodriguez, Hughes, Millan, and Aguilar were arrested in the United States on August 18, 2020, and Chairez was arrested in the United States on October 20, 2020. The AirBit Club is not their first MLM Ponzi scheme!
The AirBit Club case in a nutshell
According to the indictment, the six defendants induced victim-investors (the “victims”) to invest in AirBit Club and promised guaranteed profits in exchange for cash investments in club “memberships.” Beginning in late 2015, AirBit Club, through its founders and promoters marketed AirBit Club as a crypto-based MLM club. They falsely promised victims that AirBit Club earned returns on crypto mining and trading and that victims would earn passive, guaranteed daily returns on any membership purchased.
Victims had to purchase AirBit Club memberships in cash, using third-party cryptocurrency brokers, and by laundering the Scheme’s proceeds through several domestic and foreign bank accounts. The operators of the AirBit Clubs used the deposited money of the members for their personal enrichment and laundered it thoroughly.
Before their AirBit Club Crypto Ponzi Scheme, Renato Rodriguez and Gutemberg Dos Santos have already been running other MLM scams like the U.S. prosecutors are holding. One of them was Vizinova.
Vizinova and the SEC charges
In early 2017, the U.S. Securities and Exchange Commission (SEC) brought an enforcement action against Pablo Renato Rodriguez and Gutemberg Dos Santos related to the so-called Vizinova MLM scheme. They promised investors daily guaranteed returns for their investments in Vizinova, a cloud-based computing company. As with AirBit Club, Vizinova never paid those promised returns, and instead used investor funds to enrich themselves and pay their own personal expenses.
Rodriguez and Dos Santos agreed to settle the SEC’s charges. Without admitting or denying the allegations in the SEC’s complaint, they agreed to pay $1.4 million in disgorgement plus penalties of $160,000 each. The settlement is subject to court approval.
The U.S. prosecutors suspect that the payments to the SEC were made with the funds of the AirBit Club scams investors. The AirBit Club scam was already active at the time of the SEC enforcement action and the SEC Settlement.