Crypto Fund Block Bits Founder Convicted of Fraud, Scams Millions with 'Fake Trading Bot'

BlockBeats News, August 25th, the US Department of Justice announced that a San Francisco federal jury found Block Bits Capital, a cryptocurrency fund founded by Japheth Dillman, guilty of telecommunications fraud and conspiracy.

The prosecution alleged that Dillman raised nearly $1 million from over 20 investors between June 2017 and August 2018, claiming that the fund conducted cryptocurrency trading through proprietary software "Autotrader" to generate profits. However, he knew that the software was incomplete and not functioning properly.

Subsequently, Dillman and a co-conspirator used the investment funds for personal expenses and high-risk cryptocurrency project investments. Even after significant losses in the investments, Dillman continued to falsely claim to investors that the fund had made substantial profits. Dillman is currently released on bail and is scheduled to be sentenced on December 8th, facing a maximum of 20 years in prison and a $250,000 fine for each charge.