Score:   1
Docket Number:   ND-TX  3:18-cr-00587
Case Name:   USA v. Rice Sr
  Press Releases:
The inventor of cryptocurrency AriseCoin pleaded guilty today to duping investors out of more than $4 million, announced U.S. Attorney for the Northern District of Texas Erin Nealy Cox. 

AriseBank CEO Jared Rice, Sr. – who settled a civil action involving AriseCoin filed by the SEC’s Fort Worth regional office last year – pleaded guilty to one count of securities fraud Wednesday afternoon.  His plea makes this case one of the first in which an individual has pleaded guilty to securities fraud involving a cryptocurrency in U.S. federal court.

According to his plea papers, Mr. Rice, 30, admits he lied to would-be investors, claiming that AriseBank – billed as the world’s “first decentralized banking platform” based on the proprietary digital currency AriseCoin – could offer consumers FDIC-insured accounts and traditional banking services, including Visa-brand credit cards, in addition to cryptocurrency services.  In actuality, AriseBank had not been authorized to conduct banking in Texas, was not FDIC insured, and did not have any sort of partnership with Visa.

Even as he touted AriseBank’s nonexistent benefits, Mr. Rice quietly converted investor funds for his own personal use, spending the money on hotels, food, transportation, a family law attorney, and even a guardian ad litem – facts he failed to disclose to investors. He also failed to disclose that he’d plead guilty to state felony charges in connection with a prior internet-related business scheme. 

Meanwhile, hundreds of investors bought approximately $4,250,000 in AriseCoin using digital currencies like Bitcoin, Ethereum, and Litecoin, as well as fiat currency.

“I’m proud of the Northern District of Texas’ innovative work enforcing the rule of law in the cryptocurrency space,” said U.S. Attorney Nealy Cox. “We will not tolerate flagrant deception of investors – virtual or otherwise.”

Statutorily, Mr. Rice faces 0 to 20 years in federal prison. His sentencing is slated for July 11, 2019.  He is expected to be required to reimburse investors he deceived.

The Federal Bureau of Investigations conducted the investigation. Assistant U.S. Attorneys Mary Walters and Sid Mody are prosecuting the case.

 

SENTENCING –Anthony Turner, 26,  Xavier Ross, 26  & Afraybeom Jackson, 28

On Nov. 28, Anthony Turner and Xavier Ross were sentenced to 7 years in federal prison for their roles in a robbery.  Co-conspirator Afraybeom Jackson was sentenced to nearly 6 years. The defendants pled guilty to interference with commerce by robbery and brandishing a firearm during a crime of violence after they were arrested for robbing a jewelry store in Irving, Texas. The FBI investigated the case.

SENTENCING – a Drug Trafficking Ring

On Nov. 28, six defendants were sentenced by U.S. District Judge Barbara M.G. Lynn for their roles in a cocaine trafficking organization:

Bruce Turner, 40, aka “BK” – 12.5 years

Desmond Keith Wright, 36, aka “Deedy Weedy” – 9 years

Datanya Deone Jones, 37, aka “Worm” – 6.5 years

Gerald Jerome Duncan, 30, aka “Bear” or “Osso” – 18 months

Kennard Henry Richards-Darby, 28, aka “Boom” – time served

Johnny Lee Edwards, 37, aka “Bubba” – 3 years’ probation

The FBI investigated the case; ATF, Dallas County Sheriff’s Office, and Dallas Police Department assisted with the takedown.

INDICTMENT* – Jared Rice, 30

On Nov. 28, AriseBank CEO Jared Rice Sr. was arrested by the FBI, charged with duping hundreds of investors out of more than $4 million in a cryptocurrency scheme. According to the indictment, Rice lied to would-be investors, falsely claiming that AriseBank could offer consumers FDIC-insured accounts and traditional banking services, including Visa-branded credit cards. If convicted, he faces 120 years in prison. The FBI investigated the case. Press release here.

SENTENCING – Jose Valentin, 39, Juan Gomez-Moreno, 28, & Gabriela Morales, 32.

On Nov. 28 and 29, three defendants were sentenced for their roles in a cocaine and methamphetamine distribution conspiracy. Jose Guadalupe Valentin, who was sentenced to 10 years in federal prison, pleaded guilty in June after Dallas DEA agents intercepted him on a wiretap negotiating and purchasing cocaine from a codefendant, and discovered cocaine, currency, and firearms at his home during a raid. Juan Alberto Gomez-Moreno, who was sentenced to nearly 6 years in prison, pleaded guilty in January, after DEA agents intercepted him on a wiretap negotiating meth. Gabriela Morales, who was sentenced to 14 years in prison, also pleaded guilty in January after DEA agents intercepted her on a wiretap making multiple deliveries of meth and cocaine to various customers in the Dallas area and collecting currency that represented the proceeds from drug trafficking.

PLEA – Marcus Jones, 29

On Nov. 27, Marcus Darwyn Jones of Arlington pleaded guilty to two counts of use of a facility of interstate commerce in aid of a racketeering enterprise.  Jones admitted to using Backpage.com to facilitate prostitution of two minor victims.  Homeland Security Investigations, the Texas Attorney General’s Office, and the Fort Worth Police Department investigated.

PLEA – Marcus Pierson

On Nov. 27, Marcus Jerod Pierson of Dallas pled guilty to one count of possession with intent to distribute a controlled substance. When Pierson was arrested, he had methamphetamine, cocaine, marijuana and a handgun in his vehicle.  He faces up to 20 years  in prison and a $1,000,000 fine. The DEA conducted the investigation.

PLEA – Christina Hickson, 23

On Nov. 27, Christina Michelle Hickson of Arkansas pleaded guilty to escape from federal custody. Hickson admits that on or about May 1, she escaped from the Volunteers of America Residential Re-Entry Center after a conviction for the commission of a bank robbery.  She faces up to five years in prison and a fine of $250,000.  The United States Marshal’s Service investigated.   

SENTENCING – Bruce Brick, 51

On Nov. 26, 2018, Bruce Brick was sentenced to 18 months in federal prison for escaping from a half-way house where he was residing for failure to register as a sex offender. On June 21, 2018, Brick pled guilty to one count of escape, after he was arrested in California and transported back to Texas by the U.S. Marshal’s Service. His new sentence is to run consecutively to the sentence he received in federal court in June 2015.

* An indictment is a formal accusation of criminal conduct, not evidence. A defendant is presumed innocent unless convicted through due process of law.

AriseBank CEO Jared Rice, Sr. was arrested by the FBI on Wednesday, charged with duping hundreds of investors out of more than $4 million in a cryptocurrency scheme, announced U.S. Attorney for the Northern District of Texas Erin Nealy Cox.

Mr. Rice, who is also the subject of a civil action filed by the SEC’s Fort Worth regional office earlier this year, was indicted on three counts of securities fraud and three counts of wire fraud.

According to court documents unsealed today, Mr. Rice, 30, allegedly lied to would-be investors, claiming that AriseBank – which he billed as the world’s “first decentralized banking platform” based on a proprietary digital currency called AriseCoin – could offer consumers FDIC-insured accounts and traditional banking services, including Visa-brand credit and debit cards, in addition to cryptocurrency services.  In actuality, AriseBank had not been authorized to conduct banking in Texas, was not FDIC insured, and did not have any sort of partnership with Visa.

Even as he touted AriseBank’s nonexistent benefits in press releases and online, Mr. 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.

He allegedly falsely claimed the “Initial Coin Offering,” or ICO, had raised $600 million within just a few weeks and failed to disclose that he’d plead guilty to state felony charges in connection with a prior internet-related business scheme.  Meanwhile, investors were buying AriseCoin using digital currencies like Bitcoin, Ethereum, Litecoin, and fiat currency.

“My office is committed to enforcing the rule of law in the cryptocurrency space,” said Nealy Cox. “The Northern District of Texas will not tolerate this sort of flagrant deception – online or off.”

An Indictment is a formal accusation of criminal conduct, not evidence. A defendant is presumed innocent unless convicted through due process of law. If convicted, Mr. Rice faces up to 120 years in federal prison.

The Federal Bureau of Investigations conducted the investigation. Assistant U.S. Attorneys Mary Walters and Sid Mody are prosecuting the case.

Docket (0 Docs):   https://docs.google.com/spreadsheets/d/1MW3M08rcj_hUdNnsDO0gdv14C8K53k9LK7Mw44HIhLI
  Last Updated: 2023-10-15 12:20:31 UTC
Description: The fiscal year of the data file obtained from the AOUSC
Format: YYYY

Description: The code of the federal judicial circuit where the case was located
Format: A2

Description: The code of the federal judicial district where the case was located
Format: A2

Description: The code of the district office where the case was located
Format: A2

Description: Docket number assigned by the district to the case
Format: A7

Description: A unique number assigned to each defendant in a case which cannot be modified by the court
Format: A3

Description: A unique number assigned to each defendant in a case which can be modified by the court
Format: A3

Description: A sequential number indicating whether a case is an original proceeding or a reopen
Format: N5

Description: Case type associated with the current defendant record
Format: A2

Description: A concatenation of district, office, docket number, case type, defendant number, and reopen sequence number
Format: A18

Description: A concatenation of district, office, docket number, case type, and reopen sequence number
Format: A15

Description: The status of the defendant as assigned by the AOUSC
Format: A2

Description: A code indicating the fugitive status of a defendant
Format: A1

Description: The date upon which a defendant became a fugitive
Format: YYYYMMDD

Description: The date upon which a fugitive defendant was taken into custody
Format: YYYYMMDD

Description: The date when a case was first docketed in the district court
Format: YYYYMMDD

Description: The date upon which proceedings in a case commenced on charges pending in the district court where the defendant appeared, or the date of the defendant’s felony-waiver of indictment
Format: YYYYMMDD

Description: A code used to identify the nature of the proceeding
Format: N2

Description: The date when a defendant first appeared before a judicial officer in the district court where a charge was pending
Format: YYYYMMDD

Description: A code indicating the event by which a defendant appeared before a judicial officer in the district court where a charge was pending
Format: A2

Description: A code indicating the type of legal counsel assigned to a defendant
Format: N2

Description: The title and section of the U.S. Code applicable to the offense committed which carried the highest severity
Format: A20

Description: A code indicating the level of offense associated with FTITLE1
Format: N2

Description: The four digit AO offense code associated with FTITLE1
Format: A4

Description: The four digit D2 offense code associated with FTITLE1
Format: A4

Description: A code indicating the severity associated with FTITLE1
Format: A3

Description: The title and section of the U.S. Code applicable to the offense committed which carried the second highest severity
Format: A20

Description: A code indicating the level of offense associated with FTITLE2
Format: N2

Description: The four digit AO offense code associated with FTITLE2
Format: A4

Description: The four digit D2 offense code associated with FTITLE2
Format: A4

Description: A code indicating the severity associated with FTITLE2
Format: A3

Description: The title and section of the U.S. Code applicable to the offense committed which carried the third highest severity
Format: A20

Description: A code indicating the level of offense associated with FTITLE3
Format: N2

Description: The four digit AO offense code associated with FTITLE3
Format: A4

Description: The four digit D2 offense code associated with FTITLE3
Format: A4

Description: A code indicating the severity associated with FTITLE3
Format: A3

Description: The FIPS code used to indicate the county or parish where an offense was committed
Format: A5

Description: The date of the last action taken on the record
Format: YYYYMMDD

Description: The date upon which judicial proceedings before the court concluded
Format: YYYYMMDD

Description: The date upon which the final sentence is recorded on the docket
Format: YYYYMMDD

Description: The date upon which the case was closed
Format: YYYYMMDD

Description: The total fine imposed at sentencing for all offenses of which the defendant was convicted and a fine was imposed
Format: N8

Description: A count of defendants filed including inter-district transfers
Format: N1

Description: A count of defendants filed excluding inter-district transfers
Format: N1

Description: A count of original proceedings commenced
Format: N1

Description: A count of defendants filed whose proceedings commenced by reopen, remand, appeal, or retrial
Format: N1

Description: A count of defendants terminated including interdistrict transfers
Format: N1

Description: A count of defendants terminated excluding interdistrict transfers
Format: N1

Description: A count of original proceedings terminated
Format: N1

Description: A count of defendants terminated whose proceedings commenced by reopen, remand, appeal, or retrial
Format: N1

Description: A count of defendants pending as of the last day of the period including long term fugitives
Format: N1

Description: A count of defendants pending as of the last day of the period excluding long term fugitives
Format: N1

Description: The source from which the data were loaded into the AOUSC’s NewSTATS database
Format: A10

Description: A sequential number indicating the iteration of the defendant record
Format: N2

Description: The date the record was loaded into the AOUSC’s NewSTATS database
Format: YYYYMMDD

Description: Statistical year ID label on data file obtained from the AOUSC which represents termination year
Format: YYYY

Data imported from FJC Integrated Database
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