David Kagel, an 86-year-old ex-attorney from California, has been sentenced to five years of probation and ordered to pay almost $14 million for his involvement in a large cryptocurrency Ponzi scheme.
Kagel received the sentence on October 8 from Judge Gloria Navarro of the Las Vegas federal court after Kagel pleaded guilty to conspiracy to commit commodity fraud in May.
He is now in hospice due to his health problems and will be serving his probation in Las Vegas. If he walks out of the facility, he will be required to wear an electronic bracelet.
Kagel and two other individuals from December 2017 until June 2022 defrauded individuals into investing in a fake crypto bot trading scheme that was riskless and guaranteed high returns. They fraudulently solicited the scheme and raised about $15 million from the investors.
Being a lawyer, gave Kagel access to the letterhead of his law firm, which he used to give the impression of legitimacy to the victims. He promised investors that they would be getting 20% to 100% profits within the space of 30 days. He also pretended that he had 1,000 Bitcoin worth $11 million to secure the investments.
Kagel’s law license was then suspended in 2023 by the California Supreme Court for embezzling $25000 from clients. His two accomplices, David Saffron and Vincent Mazzotta have denied any wrongdoing and are set for trial in April 2025.
David Kagel’s sentencing sends a clear message that financial fraud, especially in the cryptocurrency space, will not be tolerated. Holding perpetrators accountable is crucial for protecting investors and restoring trust in the market.
