US law enforcement has seized 18 cryptocurrency ATMs purchased using fraudulent loans from the Small Business Administration (SBA) intended to help small businesses financially affected by the COVID-19 pandemic. The US Department of Justice (DOJ) said the loans were also used to buy bitcoin on a cryptocurrency exchange in New York.
Coindawg’s crypto ATM has been hacked
The US Department of Justice (DOJ) announced Thursday that Charles Riley Constant, aka Chuck Constant, has been arrested “on charges related to a scheme to steal and launder more than $1 million in fraudulently obtained loans from the Small Business Administration (SBA),” Including using fraud proceeds to buy cryptocurrency ATMs.” Ministry of Justice details:
Law enforcement agents seized, among other things, 18 cryptocurrency ATMs in Texas and Oklahoma that Constant had purchased with the proceeds of fraud to start a cryptocurrency ATM business called ‘Coindawg LLC’, as well as the Coindawg website.
The Justice Department explained that Constant and his co-conspirators created false identities and companies to obtain seven economic disaster loans from the Small Business Agency beginning in the fall of 2020. The money was intended to help small businesses financially affected by the COVID-19 pandemic.
Thabet used about $700,000 in fraudulently obtained SBA loans to buy bitcoin (BTC) from a cryptocurrency exchange headquartered in New York City, as noted by the Department of Justice.
The Ministry of Justice continued:
To date, Coindawg has exchanged over $3,000,000 worth of cryptocurrency and charged 15% of the transaction fee.
Constant, 54, of Allen, Texas, was charged with one count of conspiracy to commit money laundering, one count of theft of public funds, and one count of receiving stolen interstate money. If convicted, he faces a maximum sentence of 20 years in prison for conspiracy to commit money laundering and 10 years each for theft of public funds and receipt of stolen interstate funds.
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