In April 2022, the U.S. national Reginald Fowler pled guilty to bank fraud and the operation of an unlicensed money-transmitting business in connection with his Crypto Capital Corp, a payment processor that provided fiat-currency banking services to various crypto exchanges through a series of bank accounts opened under false pretenses. Prosecutors asked the court to impose a sentence of at least 82 months prison time, a money judgment of $740 million, and a restitution of $53 million.
According to the U.S. prosecutors, Reginald Fowler and his co-conspirators Yosef Oz and Ravid Oz, along with others, operated a cryptocurrency-based shadow banking system through the Crypto Capital Corp scheme (see graphics above) with companies in offshore destinations. They processed FIAT transactions for several crypto exchanges but also for drug dealers. Through the Crypto Capital Corp scheme, they allegedly provided shadow banking services to Bitfinex, Binance, Cex.io, Coinapult, QuadrigaCX, and other exchanges between 2017 and 2018.
The prosecutors said Crypto Capital Corp and Fowler fraudulently processed transactions equaling approximately $750 million in deposits and withdrawals from crypto exchanges.
Two of Fowler’s co-conspirators, the Israeli nationals Oz Yosef and Ravid Yosef, remain large.
