Yahoo Finance SEC Charges Man Behind Alleged Crypto Mining Scam
The Securities and Exchange Commission (SEC) has filed suit against Donald G. Blakstad for scamming investors partly through an allegedly fraudulent crypto mining operation.
In a filing Jan 8, the SEC alleged Blackstad, 60, bilked over $3.5 million from investors of three separate firms: an oil and gas company; a vehicle parts holding company; and “Energy Sources International” (ESI), a purported cryptocurrency mining company whose Las Vegas datacenter has only one employee: Blakstad.
The crypto mining operation specifically took in some $550,000 from five separate investors, all of whom were told by Blakstad their capital would cover equipment costs. However, the SEC alleges Blakstad instead used nearly half the cash for himself at casinos, restaurants and hotels.
Related: SEC Examination Office Gets Specific About Crypto Priorities in 2020
The regulator further alleges Blakstad kept up the ruse by issuing each of the five investors $60,000 checks as returns on their investments.
Blakstad was previously charged in July in a separate insider trading scheme worth $6.2 million.
