A federal jury has convicted Las Vegas businessman Brent C. Kovar of defrauding at least 400 investors of $24 million through a cryptocurrency investment scheme. Kovar owned Profit Connect, a company that operated from late 2017 through July 2021 and claimed to use artificial intelligence software on a supercomputer to mine crypto and verify transactions.
According to the U.S. Justice Department, Kovar falsely told investors that Profit Connect was profitable and offered fixed annual returns of 15% to 30%, alongside a 100% money-back guarantee. He also falsely claimed the company was backed by hundreds of millions of dollars in crypto reserves and that investments were insured by the Federal Deposit Insurance Corporation (FDIC).
Prosecutors demonstrated that Kovar knew these claims were false, noting that the company lacked profitability, reserves, and the ability to fulfill its guarantees. Instead of engaging in legitimate crypto mining, Kovar used incoming investor funds to keep the company operational, buy employee gifts, purchase a personal home, and execute Ponzi-style repayments to earlier investors.
Following a nine-day trial, the jury found Kovar guilty of 11 counts of wire fraud, two counts of mail fraud, and two counts of money laundering. He is scheduled to be sentenced on November 30, 2026, and faces a statutory maximum penalty of 280 years in prison.
In a separate case, a federal jury convicted San Francisco resident Japheth Dillman of wire fraud and conspiracy to commit wire fraud after a 10-day trial. Dillman and a co-conspirator defrauded more than 20 investors of nearly $1 million through false claims regarding Block Bits Capital, a crypto trading fund that falsely promised profits via an automated trading software called "Autotrader." Dillman is scheduled to be sentenced on December 8, 2026, and faces up to 20 years in prison and a $250,000 fine for each count.
