US Prosecutors Say Ex-NFL Investor Should Get Seven Years in Crypto Scam
(Bloomberg) — A former minority owner of the National Football League’s Minnesota Vikings should spend seven years behind bars and forfeit more than $740 million after admitting he helped cryptocurrency exchanges avoid money-laundering rules, prosecutors told a federal judge in New York.
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Reginald Fowler, 64, an Arizona businessman who was part of a group of investors that bought the Vikings in 2005, pleaded guilty in April 2022 to five counts, including wire and bank fraud and conspiracy to operate an unlicensed money transmitting business. He is scheduled to be sentenced Thursday by US District Judge Andrew L. Carter Jr. in Manhattan.
According to prosecutors, Fowler established Global Trading Solutions LLC, which worked with a company called Crypto Capital that allowed cryptocurrency exchanges to swap their digital currencies for cash. Fowler was accused of opening several accounts at US banks by falsely claiming they were for real estate investment transactions when the true purpose was to handle crypto transactions.
In a memo to Carter on Tuesday, the government said Fowler should spend time in prison because he played a “critical role in a serious criminal enterprise” and helped Crypto Capital operate as a “shadow bank” that allowed users of cryptocurrency to avoid law enforcement.
Fowler allowed the proceeds of crimes to move through the US financial system “through a series of lies” that have “material consequences,” prosecutors said. The banks he lied to could have faced regulatory action for having an unlicensed money-services business, the government said, and the “the recent turmoil in the US banking system reflects the substantial economic risks to the banks.”
In his plea agreement last year, Fowler also admitted to defrauding people associated with the Alliance of American Football, an upstart rival to the NFL that shut down in April 2019 after only eight weeks of play. He tried to buy a stake in the league using illegally obtained funds, according to prosecutors, who said Fowler should have to repay the league more than $53 million.
His actions with the AAF “left the league unable to pay its employees and players: players who, just like Fowler, were trying to use sports to make a better life for themselves,” the government said. “Instead of saving funds to repay his victims, the defendant then wasted hundreds of thousands of dollars at various casinos while on bail after his plea.”
While federal guidelines had called for Fowler to spend as much as 19.5 years in prison, probation officials had recommended a sentence of 120 months. Fowler’s lawyers have asked the judge to allow him to stay out of prison, saying he is “an American success story” who worked his way out of poverty and is “heartbroken by the reality that, after more than six decades of extraordinary contributions to family and community,” he allowed himself to commit crimes.
Fowler had earlier rejected a deal with prosecutors that would have allowed him to plead guilty to a single count and would have required him to give up as much as $371 million held in more than 50 accounts. He admitted to his crimes within weeks of trial. Two other defendants in the case, Crypto Capital operators Oz and Ravid Yosef, remain at large.
Fowler tried to buy the Vikings for $600 million in 2005, but had to settle for a minority stake when he couldn’t come up with the cash, according to the Star Tribune in Minneapolis. His involvement with the team ended in 2014.
The case is U.S. v. Fowler, 19-cr-254, U.S. District Court, Southern District of New York (Manhattan).
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