Indictment Details $43M Cryptocurrency and Hospitality Ponzi Scheme Spanning From 2020-2024

News | May 20, 2024 By:

On Wednesday, May 1, 2024, Damian Williams, the United States Attorney for the Southern District of New York, announced that Idin Dalpour was charged with running a $43 million Ponzi scheme that defrauded investors for over four years. FBI Assistant Director James Smith also commented on the case, praising the FBI’s work in maintaining economic justice.

According to the indictment released by prosecutors, Dalpour operated the scheme through an entity he controlled called Entity-1 beginning around 2020. He allegedly solicited investments by falsely claiming Entity-1 was involved in two lucrative business ventures – a Las Vegas hospitality enterprise and a cryptocurrency trading operation.

For the hospitality business, Dalpour misrepresented that Entity-1 had partnerships with a Las Vegas hotel and management company to rent out condos to visitors. He said the hotel arranged entertainment packages and Entity-1 received a cut of the proceeds. Dalpour also lied about owning shares in Las Vegas sports stadiums and claiming a portion of concession revenues.

To appear legitimate, Dalpour fabricated contracts between Entity-1 and its supposed partners. He created fake emails from the hotel saying Entity-1 was owed millions and forged bank statements inflating account balances. Dalpour promised annual returns as high as 42% and insisted investors’ funds were safe through insurance or escrow, which were false.

In reality, Dalpour did not use any money from investors for the hospitality business. Regarding the claimed cryptocurrency trading, Dalpour told victims he bought digital assets like bitcoin at wholesale prices and sold them at a retail profit. However, he fabricated these operations and simply drained funds from new investors to pay older ones in a classic Ponzi scheme.

Prosecutors allege over $43 million was stolen overall. Dalpour spent lavishly on himself as well, racking up $1.7 million in casino losses and paying over $400,000 for personal expenses such as his children’s private school. When confronted by angry victims last November, Dalpour reportedly confessed to lying and fabricating documents.

If convicted, Dalpour faces up to 20 years in prison for the single wire fraud charge. Damian Williams praised the FBI’s investigation and said Dalpour had violated victims’ trust with empty promises. Dalpour’s actions were described as severing faith in the investment market at the expense of others by FBI Assistant Director James Smith.