Founder of Cryptocurrency Ponzi Scheme IcomTech Sentenced to 121 Months in Prison Following HSI New York Task Force Investigation

NEW YORK — U.S. District Judge Jennifer L. Rochon sentenced David Carmona, the founder of the cryptocurrency Ponzi scheme IcomTech, to 121 months in prison following a task force investigation by Homeland Security Investigations (HSI) New York. The judge also sentenced 41-year-old Carmona, of Queens, to three years of supervised release.

HSI New York Special Agent in Charge William S. Walker announced the sentence alongside U.S. Attorney for the Southern District of New York Damian Williams. Walker praised the outstanding investigative work of special agents and task force officers from HSI’s El Dorado Task Force. He also thanked the Securities and Exchange Commission and the Commodity Futures Trading Commission for their assistance.

According to the investigation, allegations in the indictment, public court filings and statements made in public court proceedings, Carmona started IcomTech in approximately 2018 with other co-conspirators. IcomTech was a purported cryptocurrency mining and trading company that promised to earn its victim-investors profits in exchange for their purchase of purported cryptocurrency-related investment products. Carmona and other promoters of IcomTech falsely promised their victims, among other things, that profits from the companies’ cryptocurrency trading and mining would result in guaranteed daily returns on victims’ investments and doubling their money within six months. In reality, IcomTech did not engage in cryptocurrency trading or mining for its investors, and Carmona and IcomTech’s other promoters used victim funds to pay other victims, further promote the schemes and enrich themselves.

IcomTech promoters, including Carmona, traveled throughout the United States and internationally, where they hosted lavish expos and small community presentations aimed at luring victims to invest in the schemes, including in the Southern District of New York. During larger-scale events, IcomTech promoters presented on purported investment products and the compensation plan, encouraged victims to invest as a means of achieving financial freedom and boasted about the amount of money they were earning. IcomTech promoters often showed up at larger-scale events in expensive cars and wearing luxury clothing as a way of exhibiting their purportedly legitimate success from IcomTech. The atmosphere of these events was festive and designed to generate excitement about the schemes.

Victims invested in IcomTech by purchasing investment products from promoters using cash, checks, wire transfers and actual cryptocurrency. Following a victim’s investment, a victim would be provided with access to an online portal where they could monitor the purported returns. While victims saw “profits” accumulate on IcomTech’s legitimate-looking online portal, most victims were unable to withdraw any of these so-called profits and ultimately lost their entire investments. By contrast, IcomTech’s promoters, including Carmona, siphoned off, in some cases, hundreds of thousands of dollars in victim funds, which they withdrew as cash, spent on IcomTech promotional expenses and used for personal expenditures such as luxury goods and real estate.

At least as early as August 2018, victims who attempted to withdraw money from their online portal accounts had difficulty doing so, and when they complained to promoters, they were met with excuses, delays and hidden fees, if they were able to make any withdrawals at all. Despite these complaints, IcomTech promoters, including Carmona, continued to promote IcomTech and accept victims’ investments. As complaints mounted, IcomTech began offering a proprietary crypto-token for sale as a means of injecting liquidity into IcomTech. Promoters of the schemes claimed that these tokens, known as “Icoms,” would eventually be worth a significant amount of money when they were accepted by companies for payment for goods and services. This was false. In reality, Icoms were essentially worthless and resulted in further financial loss to victims. By in or about the end of 2019, IcomTech stopped making payments to victims and collapsed.

HSI New York leads and directs all operational and administrative activities of the El Dorado Task Force. The El Dorado Task Force is the premier money laundering task force in the nation and comprises more than 200 law enforcement personnel representing approximately 35 federal, state and local law enforcement and regulatory agencies. It encompasses a standalone Cyber Division as part of an effort to stay abreast of emerging criminal threats and in keeping with current and future investigative priorities. The El Dorado Task Force’s mission is to disrupt, dismantle or render ineffective organizations involved in the laundering of proceeds of narcotics trafficking and other financial crimes. Since its inception in 1992, the task force has been responsible for the seizure of approximately $600 million and more than 2,100 arrests.