German Crypto Firm USI Tech Founder Charged in $150 Million Fraud Scheme

Horst Jicha, the German founder of USI Tech, a crypto mining and digital-asset trading platform, faces severe legal consequences in the United States. Federal prosecutors in New York charged Jicha with orchestrating a fraudulent scheme that allegedly defrauded investors of approximately $150 million, according to DOJ official website. This case highlights the ongoing risks and regulatory scrutiny in the cryptocurrency sector.

Jicha, 64, has been accused of multiple crimes, including securities fraud, money laundering, and wire fraud. He was arrested on December 23, 2023, while attempting to vacation in Miami. This arrest marks a significant development in a saga that has been unfolding for several years.

In 2017, Jicha claimed USI Tech was the world's first automated Bitcoin trading platform, aiming to make crypto investments more accessible to retail investors. He aggressively marketed the platform in the United States, particularly in New York and Las Vegas. However, by March 2018, as authorities began their investigation, Jicha abruptly shut down the USI online platform. This action blocked withdrawals of about $150 million worth of investor-owned crypto assets, which remain unaccounted for.

The FBI's involvement underscores the seriousness of the allegations. James Smith, head of the FBI's New York office, stated that the platform was merely a facade and accused Jicha of fleeing the country with millions of investors' money.

Jicha's case, filed as US v Jicha, 23-CR-342 in the US District Court for the Eastern District of New York (Brooklyn), represents a stark reminder of the potential risks associated with unregulated investment platforms, particularly in the volatile cryptocurrency market. The case also underlines the increasing efforts by U.S. authorities to clamp down on fraudulent activities in the crypto space.

Jicha has pleaded not guilty to the charges and was released on a $5 million bond. His defense lawyers, Marissel Descalzo and David Tarras, have expressed their intention to defend Jicha vigorously, seeking to bring to light the facts of his involvement with USI Tech. They aim to distinguish Jicha's actions from those of the actual "bad actors."

This development in the crypto world is a critical reminder for investors to exercise caution and conduct thorough research before investing in digital assets. It also highlights the need for improved regulatory frameworks to protect investors and maintain the integrity of the crypto market.