IcomTech Crypto Ponzi Scheme: Second Circuit Affirms Guilty Verdicts
On Wednesday, April 15, 2026, Law360 reported that the Second Circuit Court of Appeals upheld the convictions and judgments against individuals involved in a $58 million cryptocurrency Ponzi scheme operated through IcomTech.
The court rejected the defendants’ claims that they were unaware of the fraudulent nature of the operation, stating that “sufficient red flags existed” to justify the lower court’s instruction to the jury regarding “conscious avoidance.”
The ruling, penned across 12 pages, affirmed the sentences and amended conviction judgments issued by U.S. District Judge Jennifer L. Rochon for David Carmona, the founder of IcomTech; Gustavo Rodriguez, the website designer; and David Brend, a promoter of the scheme. The case centered around a crypto-focused multilevel marketing scheme that prosecutors alleged used funds from new investors to pay off earlier ones, a hallmark of Ponzi schemes.
Rodriguez and Brend specifically challenged the trial court’s decision to instruct the jury on conscious avoidance, also known as willful blindness. This legal principle applies when a defendant claims ignorance of a specific fact necessary for conviction, but evidence suggests they were aware of a high probability of that fact and intentionally avoided confirming it.
The Second Circuit found this instruction appropriate, noting that “sufficiently suspicious circumstances” were present, such that a failure to ask questions could demonstrate conscious avoidance. The court highlighted that Rodriguez, who created the IcomTech website displaying increasing victim earnings, had expressed concerns that the site might “look more Ponzi-like” in discussions with Carmona.
The court documents revealed that IcomTech, along with another company called ForCount, allegedly enticed investors with promises of profits from crypto-related investment products. Investors gained access to a digital portal to track their investments and theoretically withdraw funds. However, prosecutors argued that the defendants were aware that no real investment gains were occurring.
The initial indictment occurred in 2022, leading to Carmona and another promoter, Marco Ruiz Ochoa, pleading guilty in 2023. They received sentences of 10 and five years, respectively. Rodriguez and Brend proceeded to trial and were sentenced to eight and 10 years in prison.
On appeal, Brend and Rodriguez challenged the lower court’s rulings on evidentiary admissions and jury instructions. Rodriguez specifically contested the “conscious avoidance” instruction, arguing a lack of evidence that he avoided knowing about or turned a blind eye to Carmona’s fraud. Brend argued ineffective assistance of counsel, claiming his attorney should have objected to the instruction, stating he tried to determine if the company was genuine and raised concerns to superiors.
The Second Circuit found sufficient evidence to support the jury’s conclusion that Brend knew IcomTech was a fraud. Evidence showed Brend instructed victims to send money to his shell entity with misrepresentations on checks, structured deposits to avoid reporting thresholds, and leveraged relationships with company leaders to attract investors. The court also rejected Rodriguez’s argument for a mistrial based on a jury note expressing concerns about their identities and confidentiality, stating that the note did not suggest external factors induced fear.
The Second Circuit also rejected the argument from the trio that their sentences were procedurally unreasonable. Carmona had argued that the lower court’s finding of over $58 million in actual loss was based on an unreliable spreadsheet. The Second Circuit disagreed, noting the lower court based its loss calculations on a spreadsheet showing a $58 million balance invested in the scheme from about 24,000 individuals, corroborated by victim statements and a screenshot revealing IcomTech’s earnings of at least $21 million.
Richard D. Willstatter, representing Carmona, expressed disappointment with the appellate court’s decision, stating that the finding of $58 million in actual loss was “wrong and unfairly prejudicial.”
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