The FBI has arrested the CEO of cryptocurrency platform AriseBank after he was indicted over an alleged multi-million dollar scam.
The news was announced Wednesday by the U.S. Attorney’s Office of the Northern District of Texas, which states that 30-year-old Jared Rice Sr. tricked hundreds of investors out of over $4 million and has now been charged with three counts of securities fraud and three counts of wire fraud.
Rice allegedly lied to prospective investors, claiming that the firm, which he called the “first decentralized banking platform,” would offer FDIC-insured bank accounts and Visa-linked debit and credit cards, in addition to crypto services based on its own AriseCoin token.
However, in reality, AriseBank wasn’t authorized to conduct banking services in Texas, was not FDIC insured, and had no partnership with Visa, the Justice Department states.
Rice is also accused of lying about raising “$600 million within just a few weeks” through an initial coin offering (ICO). Moreover, he spent investors’ money for his own personal use on hotels, food and clothing and more.