Two Charged With Duping Investors Out of $5M With Bogus Bitcoin-Buying Brokerage

The pair allegedly left victim's funds in an escrow service that was actually their money-laundering front.

AccessTimeIconSep 14, 2020 at 8:26 p.m. UTC
Updated Sep 14, 2021 at 9:55 a.m. UTC

New York federal prosecutors charged two men with running a phony bitcoin brokerage service that duped victims of $5 million.

  • As alleged in a criminal complaint unsealed Monday, former fugitive Randy Craig Levine and disbarred attorney Philip Reichenthal never bought their two high-rolling investors any bitcoin despite promising to do so.
  • One victim, an unnamed "purported cryptocurrency escrow firm," wired Levine $3 million to fund an over-the-counter desk's bitcoin buy, according to prosecutors, who said the second victim, a Florida bitcoin investor, wired Levine $2 million.
  • Levine allegedly told the victims their funds were moved into an "escrow" service and then stopped responding to the victims' questions.
  • But Levine's escrow was actually Reichenthal's money-laundering front, prosecutors allege. They claim Reichenthal wired millions to Russian, Mexican and Guatemalan bank accounts controlled by Levine aliases.
  • Levine and Reichenthal allegedly pocketed the money, giving their victims no refunds or bitcoin.
  • The pair face allegations of wire fraud, money laundering and commodities fraud in New York federal district court.
  • Levine is currently awaiting extradition from Austria; he's been on the run from U.S. authorities since 2005. Reichenthal was disbarred last October in a Florida court.

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