The AriseBank founder has been arrest by FBI for theft. This is coming on the heels of accusations that the Arisebank ICO was unauthorized and fraudulent.
The AriseBank initial coin offering has been in the court under civil proceedings when the founder was arrested for theft of $4 million from investors.
A press release by the Department of Justice confirmed the arrest of 30 year old Jared Rice Sr. who is the founder of AriseBank. Information from the justice department said that the founder had gone on a spending spree even before the AriseBank ICO was concluded.
“Even as he touted AriseBank’s nonexistent benefits in press releases and online, Rice quietly converted investor funds for his own personal use, spending the money on hotels, food, clothing, a family law attorney, and even a guardian ad litem.”
This brings the fore one of the challenges that has beleaguered the cryptocurrency space. The absence of clear regulations has resulted in having all sorts of shady characters hide under the anonymity provided by digital tokens and the internet to sell dubious tokens.
A Scammer and Molester
Available records show that Rice has had a history of violence and crime and had issues with the authorities. Despite these, he successfully held and initial coin offering raising millions of dollars which he mostly diverted to personal use.
Jared who was indicted by a court in Texas for tampering with government in 2015 has now been arrested for stealing investors’ funds after AriseBank ICO. The previous indictment was for forging the secretary of the state of Texas seal in incorporation documents.
It is interesting that the AriseBank successfully raised ICO funds despite the records of Jared’s misdemeanor being in public domain. This is one of the reasons there have been calls for investigative reviews that will at least run background checks on initial coin offerings to determine the IDs of the teams behind these projects and check this data on databases to ensure that people of dubious character do not succeed in defrauding investors.
Jared has also been arrested in the past for defrauding a business partner. There also was an indictment by a grand jury for assault on a family member for which he was held on $15,000 bond.
Evidence with the justice department shows that the AriseBank founder used part of proceed of the ICO sale to pay for hotel bills. Other frivolous purchases of clothing and payment for food were also documented.
AriseBank ICO has long been declared a fraud. The arrest and indictment of the founder should send some signals to cyber criminals that have been exploiting the ICO space that has been described as a wild west.
Nevertheless, the problem of scam ICOs persists because most of the scammers these days are not even known. They simply accomplish their objectives by using fake IDs while most review sites rate them without appropriate research.