INTELLIGENT INTELLIGENCE TO PROTECT THE PUBLIC. IN 1972 THERE WAS "WATERGATE" TRIGGERED BY BURGLARS. SINCE 2012, WE HAVE BEEN EXPOSING WHAT WILL BECOME KNOWN AS "BANKERGATE" WHERE WE UNCOVERED WILLFUL, LARGE SCALE, ORGANIZED, TRANSNATIONAL MONEY LAUNDERING TRIGGERED BY BENEFICIARIES AS PROXIES FOR CERTAIN GLOBAL BANKS USING PARALLEL SCREENS + NONBANK SERVERS, ABUSING NOSTRO ACCOUNTS, IP DEBITS + CREDITS, NO SWIFT FINGERPRINTS FOR FBI, CIA OR DHS. IT MAKES INVISIBLE PROJECT HAMMER, FARM 42 LARGE SCALE COUNTERFEIT CURRENCY MONEY LAUNDERING. IT IS THE PERFECT CRIME! IT IS A SERIOUS NATIONAL SECURITY THREAT!
PATRICK McDONNELL (aka: Jason Flack): CRYPTO TRADER + CABBAGETECH FOUNDER INDICTED BY USA DOJ with 9 counts of wire fraud
ABOVE – Patrick PK McDonnell (aka: Jason Flack)
https://www.coindesk.com/cabbagetech-ceo-indicted-in-new-york-for-defrauding-crypto-investors
The 46-year-old owner of a firm called CabbageTech has been charged in New York with duping investors out of over $200,000 in cryptocurrency and cash.
The U.S. Attorney’s Office of the Eastern District of New York announced Tuesday that it has unsealed a nine-count indictment charging Patrick McDonnell, also known as “Jason Flack,” with wire fraud and has arrested him.
Between November 2014 and January 2018, McDonnell allegedly represented himself as an experienced cryptocurrency trader, promising customers that he would provide them with trading advice, as well as buy and trade cryptocurrency on their behalf. McDonnell is said to have used his Staten Island-based company, CabbageTech Crop., also known as Coin Drop Markets, to solicit investments through social media platforms, including Facebook and Twitter.
However, neither McDonnell nor CabbageTech provided any investment services, according to the indictment. Instead, he sent investors “false” balance statements indicating that their investments were profitable, and “stole their money for his personal use.” When customers requested refunds, McDonnell allegedly first made excuses for delays in repayment and later stopped responding at all.
In total, McDonnell defrauded at least 10 victims of at least $194,000 in cash, 4.41 bitcoin (worth $17,500 at press time), 206 litecoin ($12,304), 620 ethereum classic ($2,914) and 1,342,634 verge ($9,965), according to the indictment.
“The defendant’s fraud ends now, he will be held responsible for his criminal conduct,” said Richard P. Donoghue, attorney for the Eastern District of New York. If proven guilty and convicted, McDonnell faces a jail term of a maximum 20 years.
McDonnell was previously sued by the U.S. derivatives regulator, the Commodity Futures Trading Commission (CFTC), in January 2018 for absconding with customers’ crypto assets.
Later in July, the CFTC wrapped up the case against McDonnell and was seeking a permanent injunction against him. McDonnell at the time gave up the fight saying he did not have the resources or the ability to continue contesting the charges brought against him.
“For the sake of pure minute-to-minute survival, I must continue to be removed from proceeding,” he said.
In the same case, the presiding district judge notably backed the CFTC in defining cryptocurrencies as commodities. At issue was whether the commission had the authority to regulate cryptocurrency as a commodity in the absence of federal level rules, and whether the law permitted the CFTC to exercise its jurisdiction in the matter.
BACKGROUND: Staten Island man accused of duping investors with ‘Anonymous’ hacker mask
He’s not anonymous anymore.
A Staten Island man was accused of donning the infamous “Anonymous” hacker mask in a video he used to dupe investors into spending money on his sham virtual currency firm.
Patrick McDonnell, aka “Jason Flack,” used “smoke and mirrors” techniques to trick investors into sending his company, CabbageTech, cash between 2016 and 2018, investigators said.
The investors thought they were paying for “advice and strategies on crypto-currency trading,” — but McDonnell, 46, pocketed the cash instead, prosecutors said.
McDonnell, who once dubbed himself “The Coyote of Wall Street,” duped his victims into thinking his firm was legit — even telling one that he had over 8,000 investors and had traded over $50 million in bitcoin, according to the indictment filed in Brooklyn Federal Court.
A YouTube video even allegedly shows the faux crypto-currency trader talking about virtual cash like Bitcoin while wearing the Guy Fawkes mask.
McDonnell would send his clients bogus bank statements claiming their investments in virtual currency were doing well, prosecutors said. And when they asked for their money back, he made excuses and then stopped answering.
Instead of investing the money, he spent at least $194,000, 4.41. Bitcoin, 206 Litcoin and other virtual currency on himself, prosecutors said.
“As alleged, the defendant defrauded investors by making false promises and sending them fraudulent balance statements, hiding the fact that he was stealing their money for his personal use,” said United States Attorney Donoghue.
“The defendant’s fraud ends now, he will be held responsible for his criminal conduct.”
McDonnell, who was charged with wire fraud in connection with a scheme to defraud investors in virtual currency, made a brief appearance in Brooklyn Federal Court on Tuesday — without his mask. He did not post bail.
He faces a maximum of 20 years in prison.
USA DOJ ANNOUNCEMENT: Staten Island Man Indicted for Defrauding Investors Trading in Virtual Currency
Department of Justice
U.S. Attorney’s Office
Eastern District of New York
FOR IMMEDIATE RELEASE
Defendant Solicited Investments on Facebook and Twitter, But Allegedly Stole the Money for Personal Use
A nine-count indictment was unsealed today in federal court in Brooklyn charging Patrick McDonnell, also known as “Jason Flack,” with wire fraud in connection with a scheme to defraud investors in virtual currency. McDonnell was arrested earlier today, and is scheduled to be arraigned this afternoon before United States Magistrate Judge Sanket J. Bulsara.
Richard P. Donoghue, United States Attorney for the Eastern District of New York, and Philip R. Bartlett, Inspector-in-Charge, United States Postal Inspection Service, New York Division (USPIS), announced the charges.
“As alleged, the defendant defrauded investors by making false promises and sending them fraudulent balance statements, hiding the fact that he was stealing their money for his personal use,” stated United States Attorney Donoghue. “The defendant’s fraud ends now, he will be held responsible for his criminal conduct.” Mr. Donoghue expressed his grateful appreciation to the United States Commodity Futures Trading Commission (CFTC) for its significant cooperation and assistance in this case.
“The defendant, Patrick K. McDonnell, used smoke and mirrors to allegedly dupe investors into paying his company—CabbageTech, for advice and strategies on crypto-currency trading,” stated USPIS Special Agent-in-Charge Bartlett. “However, Postal Inspectors and their federal law enforcement partners unmasked McDonnell and his scheme to defraud investors, and brought him to justice for his alleged criminal actions.”
As alleged in the indictment, between approximately November 2014 and January 2018, McDonnell portrayed himself as an experienced trader in virtual currency, promising customers he would provide trading advice, and purchase and trade virtual currency on their behalf. Beginning in approximately May 2016, McDonnell made similar representations through his Staten Island-based company, CabbageTech, Corp., also known as Coin Drop Markets. However, neither McDonnell nor CabbageTech provided investment services. Instead, McDonnell sent investors false balance statements purportedly showing that their investments had been profitable, and stole their money for his personal use. When investors requested refunds, McDonnell initially offered excuses for delays in repayment, and eventually stopped responding at all. In total, McDonnell defrauded at least 10 victims of at least $194,000 in U.S. currency, 4.41 Bitcoin, 206 Litecoin, 620 Ethereum Classic and 1,342,634 Verge currency.
The charges in the indictment are allegations, and the defendant is presumed innocent unless and until proven guilty. If convicted, McDonnell faces a maximum sentence of 20 years’ imprisonment.
The government’s case is being handled by the Office’s Business and Securities Fraud Section. Assistant United States Attorney Hiral D. Mehta is in charge of the prosecution.
The Defendant:
PATRICK MCDONNELL (also known as “Jason Flack”)
Age: 46
Staten Island, New York
E.D.N.Y. Docket No. 19-CR-148 (NGG)
USA DOJ INDICTMENT – Patrick McDonnell (aka: Jason Flack)
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