Long Island Man Found Guilty of Wire Fraud and Money Laundering in Cryptocurrency Scheme
On Thursday, September 26, 2024, the United States Attorney for the Southern District of New York announced that Eugene William Austin Jr., also known as “Hugh Austin,” was found guilty of multiple charges related to a scheme involving wire fraud, money laundering, and the interstate transportation of stolen property. The conviction was the result of a jury trial held before U.S. District Judge P. Kevin Castel on September 24, 2024.
Austin, 62, a resident of Port Jefferson, New York, was implicated in a conspiracy that defrauded numerous individuals and organizations across the country, resulting in substantial financial losses. His co-defendant and son, Brandon Austin, had previously pleaded guilty to charges of conspiracy to commit money laundering and received a four-year prison sentence.
U.S. Attorney Damian Williams confirmed the conviction, stating that the jury unanimously determined that Austin had engaged in a long-term fraudulent scheme that caused millions of dollars in losses. The prosecution highlighted that Austin had worked alongside his son in these illicit activities. Williams emphasized the importance of accountability and the commitment of law enforcement to bring fraudsters to justice.
The indictment and evidence presented during the trial detailed a sophisticated operation where Austin and his son misled victims by offering fraudulent investment opportunities. They claimed to serve as brokers for significant cryptocurrency transactions, promised high returns on short-term investments, and allegedly secured funding for startups from a network of wealthy individuals.
As part of their fraudulent activities, Austin frequently sought personal loans from acquaintances, assuring them of repayment with interest. However, these promises were not fulfilled, leading to financial losses for those who lent money. The defendants reportedly diverted funds from investors for personal expenses, including travel, luxury accommodations, dining, shopping, and transfers to family members, while also making nominal payments to victims to prolong their schemes.
Several specific instances of fraud were detailed in the trial. In August 2018, Austin and Brandon induced a California-based investment firm to wire approximately $5 million to a Manhattan attorney under the pretext of purchasing cryptocurrency. The cryptocurrency was never delivered, resulting in significant losses for the firm.
In another case from September 2018, they convinced a cryptocurrency startup to send around $100,000 as a short-term loan for a purported transaction, but instead of utilizing the funds as promised, the defendants used the money for personal expenses.
Further fraudulent activities included a June 2020 incident where they laundered approximately $767,000 that had been sent via wire transfer to a New York-based real estate attorney for a claimed cryptocurrency transaction. In October 2021, Austin and Brandon stole about $528,000 in another wire transfer intended for the purchase of Bitcoin.
Austin was convicted of one count of conspiracy to commit wire fraud, carrying a maximum potential sentence of 20 years in prison; one count of conspiracy to commit money laundering, also with a maximum sentence of 20 years; and one count of conspiracy to receive stolen property, which has a maximum potential sentence of five years. His sentencing is scheduled for February 20, 2025.
