U.S. federal authorities are accusing an Instagram user of defrauding followers for millions of dollars in Bitcoin.
What Happened: The accusations are against Jegara Igbara, who investigators say used the social media handle “Jay Mazini.”
A press release put out last week by the Justice Department’s U.S. Attorney’s Office in the Eastern District of New York details the accusations and includes supporting statements from the Federal Bureau of Investigation and Internal Revenue Service.
Igbara allegedly defrauded his social media followers out of millions of dollars by promising to buy their Bitcoin “at prices 3.5% to 5% over market value” and sending them fake screenshots of confirmed wire transfers.
Igbara allegedly claimed that he was willing to pay above-market prices because the traditional Bitcoin exchanges were limiting how much Bitcoin he could purchase.
Investigators say Igbara’s Instagram account had nearly 1 million followers and he posted videos of himself handing out large amounts of cash to people as gifts. They say he also used his Twitter account to promote his scam.
‘Buyer Beware’: According to a press release from the U.S Department of Justice, Igbara never actually sent the money and stole at least $2.5 million worth of Bitcoin from victims.
“Igbara used his immense social media popularity to dupe his followers into selling him Bitcoin,” said Mark Lesko, acting U.S. attorney for the Eastern District of New York.
Court documents detailing the experiences of several victims revealed that one person transferred approximately 54 Bitcoin to Igbara. The person only received $500,000 in payments of the $2.56 million promised, according to the documents. Igbara is said to have provided multiple, varying explanations for the failure of the wire transfers to arrive.
“Buyer beware when making purchases of Bitcoin or any other cryptocurrency over social media,” said Jonathan Larsen, an investigator for the Internal Revenue Service.
Igbara is being held by authorities on state charges in New Jersey, and his social media accounts have been deleted. If convicted, he faces a sentence of up to 20 years in prison.
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