CEO and Founder of AriseBank and it’s associated crypto-token, AriseCoin, Jared Rice Sr. was indicted in the Northern District of Texas, and faces a possible prison sentence of up to 120 years.
The FBI arrested Rice Sr during Wednesday and was charged with over 3 counts of wire fraud for allegedly defrauding investors out of more than $4 million during the course of promoting AriseBank, dubbed as “the world’s first decentralized bank.”
The $4 million number definitely cemented a positive public image if one considers Rice Sr pubically claimed to have raised a total of $600 million in the AriseCoin ICO a while ago.
AriseBank awas also placed under the scrutiny of Securities and Exchange Commission (SEC) enforcement actions lead to the ICO being halted back during January 2018. In addition to the cryptocurrency services provided, his “decentralized bank” could offer FDIC insured accounts and standard banking services as well as Visa branded credit and debit cards, according to Rice SR.
The Northern District has claimed that this is not actually true.
Prosecutors have stated that while the accused,
“…touted AriseBank’s nonexistent benefits in press releases and online…(he) quietly converted investor funds for his own personal use, spending the money on hotels, food, clothing, a family law attorney, and even a guardian ad litem (child custody consultant).”
U.S. Attorney for the Northern District of Texas, Erin Nealy Cox, had this to say regard the arrest and charge of Jared Rice Sr,
“My office is committed to enforcing the rule of law in the cryptocurrency space…The Northern District of Texas will not tolerate this sort of flagrant deception – online or off.”
Here’s the full indictment.
As Fascinating as it would’ve been to see the very first decentralized bank, scamming schemes like these have been quite common as of recently. Even so, cryptocurrency will continue to rain hard as more and more people jump in on it and continue to promote the digital assets. Careful watch of upcoming startups that seem too good to be true need to be placed under heavy scrutiny.