Abramoff Faces Possible Prison Sentence, Formerly Incarcerated for Defrauding Tribes

Posted on: June 30, 2020, 08:34h. 

Last updated on: June 30, 2020, 10:30h.

Ed Silverstein @casinoorgedsilv Read More

Expertise: Legal, Tribal Gaming.

New federal charges are pending against one-time lobbyist Jack Abramoff for a plot involving bitcoin. The new charges arrive several years after his previous arrest and sentencing for violations related to the tribal gaming sector.

In the new case announced last week, Abramoff was charged with conspiracy to commit wire fraud and violating the Lobbying Disclosure Act, according to California US Attorney David L. Anderson. In a connected case, a federal grand jury in San Francisco indicted Rowland Marcus Andrade, 42, of Missouri City, Texas, for wire fraud and money laundering.

Andrade was the founder and CEO of NAC Foundation, which claimed to have developed and managed a cryptocurrency called AML Bitcoin. The company said the cryptocurrency could not be used for money laundering. Andrade and Abramoff also allegedly conspired to make false and misleading statements to potential purchasers.

Beginning in July 2017, NAC Foundation started raising money to develop AML Bitcoin by selling the cryptocurrency to purchasers. Sales continued through at least December 2018.

Andrade and Abramoff further allegedly claimed that the NAC Foundation was going to reach agreements with government agencies for the use of AML Bitcoin or AML Bitcoin technology. Abramoff additionally allegedly hired writers to author content in publications regarding these claims.

Abramoff also allegedly failed to register as a lobbyist in connection with the marijuana industry, as required by the Lobbying Disclosure Act, after being retained for lobbying efforts with a federal official. The case represents the first prosecution of a lobbyist for a criminal violation of the Lobbying Disclosure Act, federal officials said.

If convicted, Abramoff faces a maximum prison sentence of five years and a fine of $250,000 for each of the counts. Andrade faces a maximum sentence of 20 years and a fine of $250,000 for each of the counts.

SEC Files Civil Charges

In a separate action, the federal Securities and Exchange Commission (SEC) filed civil charges against Andrade and Abramoff, alleging securities fraud and acting as unregistered brokers of securities.

The SEC said that the Nevada-based NAC Foundation raised at least $5.6 million from more than 2,400 investors by selling tokens that could later be converted to AML Bitcoin.

“We allege that these defendants repeatedly misled investors into funding non-existent technology, falsely claiming that the technology would make digital asset transactions more secure,” Kristina Littman, chief of the SEC Enforcement Division’s Cyber Unit, said in a recent statement.

Former Fraud

In 2008, Abramoff was sentenced to four years in prison and ordered to pay over $23 million for allegedly conspiring to defraud four Native American tribes that either operated, or were interested in operating, casinos. The tribes were in Mississippi, Louisiana, Texas, and Michigan.

Each tribe hired Abramoff for consulting advice on how to limit competition from competing casinos or advice on how to re-open a closed casino.

In 2006, Abramoff pleaded guilty to a single count each of conspiracy to commit fraud, honest services fraud involving public officials, and tax evasion. Abramoff had admitted he received undisclosed kickbacks from former lobbyist Michael Scanlon, who owned and operated Capitol Campaign Strategies.

Multiple other defendants were sentenced to prison for their roles. The wide-ranging case led to national attention