U.S. law enforcement confiscated 18 cryptocurrency ATMs which were acquired with illegal loans from the Small Business Administration (SBA). This organization was created to help small businesses recover from financial damage caused by the Covid-19 pandemic. The perpetrator also used the funds to purchase bitcoin from a cryptocurrency exchange.
Coindawg’s Crypto ATMs Seized
The U.S. Department Of Justice (DOJ) announced on Thursday the arrest of Charles Riley Constant, aka Chuck Constant, “for charges in connection with a scheme to steal and launder over $1 million in fraudulently obtained loans from the Small Business Administration (SBA), including the use of fraud proceeds to purchase cryptocurrency ATMs.” According to the Justice Department,
Law enforcement agents seized 18 cryptocurrency ATMs in Texas and Oklahoma that Constant purchased with fraud proceeds to form a company called ‘Coindawg LLC’, as well as Coindawg’s website.
The DOJ reported that Constant and his co-conspirators made up fake identities and businesses to obtain seven Economic Injury Disaster Loans from the SBA in 2020. Such funds were meant to help small businesses that have been financially damaged by the Covid-19 pandemic.
Constant allegedly used almost $700,000 of the fraudulently obtained funds to purchase bitcoin from a cryptocurrency exchange in Inglewood, New York City. The DOJ added that:
To date, Coindawg has exchanged over $3,000,000 in cryptocurrency and has charged 15% transaction fees.
Constant, 54, of Allen, Texas, was charged with one count each of conspiracy and money laundering, theft, public money and interstate receipt. If found guilty, he faces a maximum sentence of 20 years in prison for conspiracy and money laundering, and 10 years for theft and interstate receipt.
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