AriseBank Chief Arrested, Charged in Crypto ScamDec 03, 2018 at 20:06
AriseBank’s CEO is facing 120 years of jail time alongside a $4 million fine for falsely promoting the crypto platform as offering multiple banking services.
In its indictment, the United States Department of Justice charged Jared Rice, Sr., AriseBank’s founder, of defrauding investors by making several fraudulent claims in promoting his initial coin offering which generated a total of $4.25 million from hundreds of investors—far from the billion-dollar mark achievement claimed.
Among the false misrepresentations made by Rice is issuing a Visa-branded card to consumers despite the platform not entering into partnered with Visa.
He also claimed AriseBank was authorized by the Texas Department of Banking to offer banking services and that it bought out two firms, an acquisition said to allow AriseBank to offer FDIC-insured accounts.
However, no regulatory approval was ever obtained nor was there an acquisition that took place.
As for the money collected from the ICO, Mr. Rice discreetly used investor funds for his own personal use, spending the money on hotels, food, clothing, etc., according to the court records.
Rice had previously been charged in other cases: tampering with government records in Texas for forging the Secretary of State’s seal and signature on incorporation documents, the same case also leading to Rice’s stealing of investor funds in the same case.
Rice had also been under arrest and held on $15,000 bond for assault on a family member.