Crypto fund fraud conviction: Dillman faces 20 years over fake Autotrader bot
A federal jury in San Francisco has delivered a crypto fund fraud conviction against Japheth Dillman, the 48-year-old founder of Block Bits Capital, after prosecutors showed he sold investors on trading software he knew never actually worked. The verdict, announced by the Justice Department, closes out a case that stretched back nearly a decade to when Dillman first began pitching an automated cryptocurrency trading tool that turned out to be little more than a pitch deck.
Key takeaways
- Japheth Dillman was convicted of wire fraud and conspiracy by a federal jury in San Francisco after a 10-day trial.
- He raised nearly $1 million from more than 20 investors for his fund, Block Bits Capital, between June 2017 and August 2018.
- Dillman claimed the fund used a working automated trading tool called the Autotrader, which prosecutors say never functioned.
- Investor money was instead used for personal payments and risky crypto bets that lost heavily, while Dillman falsely reported profits.
- He faces up to 20 years in prison and a $250,000 fine per count, with sentencing set for December 8.
Federal Jury Convicts Japheth Dillman of Crypto Fund Fraud
A jury in the Northern District of California found Dillman guilty of wire fraud and conspiracy to commit wire fraud following a 10-day trial before U.S. District Judge Richard Seeborg. The Justice Department confirmed the verdict on Monday, capping a prosecution that examined years of misleading statements Dillman made to people who trusted him with their savings.
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