Former executives of a bankrupt crypto lending and investing firm, Cred, are facing charges from the US Department of Justice. The accusations claim that the defendants, Daniel Schatt, Joseph Podulka, and James Alexander, were involved in a scheme that led to customers losing over $783 million in crypto holdings.
The DOJ alleged that the executives made false statements, including claims that Cred only engaged in collateralized and guaranteed lending, had all-weather protection against volatility, and was a licensed lender with comprehensive insurance. Marketing materials reportedly misrepresented the firm’s financial stability.
The charges against the individuals include conspiracy, wire fraud, and money laundering, carrying potential lengthy prison sentences and millions of dollars in fines. Schatt and Podulka have already made their first court appearance, with Alexander’s pending.
This case is part of a series of recent legal actions by the DOJ in the crypto space, including charges against Bitcoin proponent Roger Ver and the founders of the privacy-enabled crypto wallet Samourai Wallet. The case is being handled in the Northern District of California.
