A Las Vegas business owner faces a statutory maximum sentence of 280 years in prison after a federal jury convicted him of operating a $24 million cryptocurrency Ponzi scheme that defrauded at least 400 investors.
According to the US Justice Department, Brent Kovar was found guilty of 11 counts of wire fraud, two counts of mail fraud, and two counts of money laundering following a nine-day trial.
Kovar owned and operated Profit Connect between late 2017 and July 2021. The firm allegedly claimed to use artificial intelligence software on a supercomputer for cryptocurrency mining and transaction verification.
During the operation of the scheme, Kovar falsely portrayed the company as highly profitable. He guaranteed fixed annual returns between 15% and 30%, offered a 100% money-back guarantee, and claimed the company maintained hundreds of millions of dollars in cryptocurrency reserves.
Prosecutors established during the trial that Profit Connect was not profitable, possessed no such reserves, and lacked any legitimate means to fulfill its financial promises. Rather than generating returns through crypto activities, Kovar used incoming investor funds to run the business, purchase employee gifts, buy a personal residence, and make Ponzi-style payments to earlier investors.
Kovar is scheduled to be sentenced on November 30. The 280-year total reflects the combined statutory maximum for all counts, and a federal judge will determine the final sentence.
