Crypto CEO Horst Jicha skips bond in fraud case

A German nationwide who was below residence detention in New York Metropolis on a $5 million bond assured by his home associate and kids in a case through which he was charged with overseeing a $150 million cryptocurrency fraud is now a fugitive.

“There is a very lively investigation underway to seize him,” mentioned John Marzulli, a spokesman for the Brooklyn U.S. legal professional’s workplace, on Friday, a day after the defendant, Horst Jicha, failed to look in Brooklyn federal court docket as scheduled.

“We’re going to forfeit the bond,” Marzulli added, which means that prosecutors will search to acquire the $4 million portion of the bond that was personally assured by Jicha’s associate, youngsters and three different folks, all of whom stay in Germany.

One other $1 million in money to safe the bond had been deposited with the federal authorities.

Horst is suspected of getting tampered along with his ankle bracelet monitor on Oct. 3, a prosecutor from the Brooklyn U.S. legal professional’s workplace informed a choose Thursday at a listening to that was supposed to deal with pretrial points within the case.

After noticing that Jicha’s ankle bracelet was not working, Pretrial Providers officers despatched him an e mail directing him to go to their workplace the following day. Jicha didn’t present up, the prosecutor informed U.S. District Court docket Choose Orelia Service provider.

Solely then did Pretrial Providers inform prosecutors that Jicha’s ankle bracelet had ceased working, 26 hours after turning into conscious of that truth, the prosecutor informed the choose.

Jicha’s protection legal professionals didn’t instantly reply to a request for remark.

CNBC has requested remark from Pretrial Providers in Brooklyn federal court docket.

Jicha is scheduled to go on trial within the case March 31, the place he faces a number of expenses of securities fraud and conspiracy associated to a multi-level advertising and marketing scheme often called USI Tech.

In accordance with prosecutors, Jicha lied to retail traders when he informed them they’d make a mean of 140% returns on their cash in a 140-day interval.

Traders have been informed that there have been two methods they may make cash: First, they may spend money on what have been purportedly bitcoin mining and buying and selling operations. They may additionally earn commissions for referring others to purchase USI Tech merchandise, the indictment towards Jicha says.

“In actuality the platform was only a facade, and when questions arose, Jicha stole thousands and thousands of his traders’ cash and fled the nation,” FBI Assistant Director in Cost James Smith mentioned in January.

As of Friday, Jicha’s whereabouts have been unknown. Court docket information present he had lived in Brazil and Spain earlier than he was arrested in Florida in late 2023.

Jicha was launched on bond in January, and had lived in Brooklyn.

Underneath the circumstances of Jicha’s launch, he was obligated to stay in New York Metropolis or Lengthy Island, and to not go away his residence save for court docket appearances, legal professional visits or medical appointments, except approved by Pretrial Providers.

Jicha, 64, additionally was required to give up all passports and journey paperwork as a situation of his launch.

Court docket information present that Jicha’s $5 million launch bond was assured and signed in January by his home associate Ewa Jicha, in addition to by Jicha’s grownup son and his three daughters, and by the boyfriend of certainly one of Jicha’s daughters and by the boyfriend’s brother and father, court docket information present.

All of these folks have been residents of the German state of Baden-Württemberg, in response to court docket information.

However below the phrases of the bond, they’re additionally personally chargeable for the bond’s quantity.

After Horst Jicha was launched, Ewa Jicha acted because the third-party custodian for him, and was required to report any violations of his launch to a U.S. probation officer.

Jicha was arrested on Dec. 23 in Miami, after coming into the USA for the primary time in additional than 5 years, to trip there.

Prosecutors allege that Jicha launched USI Tech in Europe, the place, as a co-founder and CEO, he claimed the corporate would make “cryptocurrency investments straightforward and accessible to the common retail investor.”

“In actuality, it was a multilevel advertising and marketing scheme that relied on traders recruiting different traders under them to purchase varied purported cryptocurrency investments,” the U.S. legal professional’s workplace mentioned in January.

“In 2017, Jicha introduced USI Tech to the USA and aggressively marketed it to U.S. retailers on social media and thru in-person displays through which he falsely assured excessive returns on investments and made false claims concerning the legality of the platform’s funding choices,” the workplace mentioned. There are a number of movies on YouTube displaying Jicha hyping the corporate.

In early 2018, after USI Tech got here below regulatory scrutiny within the U.S., “it ceased all U.S. operations in a single day, leaving traders with no potential to entry their cash and leading to thousands and thousands of {dollars} in losses.”

Prosecutors mentioned that a lot of the lacking cash within the rip-off, “valued at roughly $150 million as of the date of his arrest,” was held within the type of ether and bitcoin cryptocurrency. After USI Tech stopped working, that cryptocurrency was despatched to digital deposit addresses managed by Jicha.