Promoter pleads guilty in crypto investment fraud case involving 'Bitcoiin' scam
July 31, 2021, 1:29PM EDT
1 min read
A California-based man pleaded guilty on Friday for his participation in a "coordinated cryptocurrency and securities fraud scheme" that once attracted the endorsement of celebrity actor Steven Seagal.
John DeMarr pled to one count of conspiracy to commit securities fraud and will be sentenced in January. He faces a maximum sentence of five years in prison. DeMarr was arrested and charged in February and accused by U.S. prosecutors of conspiring to "defraud investor victims by inducing them to invest in their companies, “Start Options” and “B2G,” based on materially false and misleading representations."
DeMarr, along with two others, were charged by the SEC earlier this year.
As noted by prosecutors, B2G — also known as "Bitcoiin" emerged in early 2018 as part of the initial coin offering craze. B2G was an extension of the Start Options scheme intended to keep investors around. "In late January 2018, rather than permitting Start Options investors to withdraw money from their accounts after the requisite time period, DeMarr and others required investors to roll over their accounts into an unregistered “initial coin offering,” or ICO, of B2G, the second of the two fraudulent companies in which DeMarr was involved."
Bitcoiin infamous netted the endorsement of Seagal, who went on to settle with the SEC in February 2020. He neither admitted nor denied the findings of the SEC, which alleged at the time that he failed to disclose payments he received.
Friday's statement indicates that the B2G/Start Options investigation is ongoing.
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