New York Federal Prosecutors announced Friday that Philip Reichenthal (a disbarred attorney) pleaded guilty to conspiracy for wire fraud in connection to a scheme to defraud Bitcoin investors.
Reichenthal claimed that he would be acting as an escrow agent in order to facilitate the transactions. In executing the transactions, he worked with Randy Craig Levine (an international fugitive who was a former Coral Springs resident). Levine and Reichenthal fraudulently incentivized victims to send millions to Reichenthal, who was a licensed lawyer at the time.
A Justice Department press release states that Levine convinced the first victim, Volantis Entities’ head of cryptocurrency escrow, June and July 2018, to wire $3million to Reichenthal in order to finance an over-the counter desk’s Bitcoin purchase. Instead of buying the Bitcoins for the client’s purchase, Reichenthal wired more than $2 million to a Guatemala bank where Levine had an accounts. No Bitcoins were bought.
Levine and Reichenthal also arranged another Bitcoin transaction that was never completed between February and May 2019. Reichenthal was sent $2 million by a Florida Bitcoin investor to help him purchase his Bitcoins. Levine and his lawyer did not buy the Bitcoins for the investor, yet again. Reichenthal is accused of wired $1.9million to Levine’s Mexican bank accounts.
Reichenthal was taken into custody on September 14, 2020 and pleaded guilty before U.S. Magistrate Judge Debra Freedomman on Friday, February 11, 2021. Reichenthal was arrested and sentenced to a 20-year term in prison.
U.S. attorney Damian Williams made the following statement while he was making the ruling: “As an escrow agent and licensed attorney, Philip Reichenthal was entrusted with keeping investors’ money safe. He admitted that he had swindled millions of dollars from investors’ money, and he did so by betraying that trust. He is now guilty of wire fraud, and awaits his sentencing.