An independent candidate for Governor of Tennessee is facing an eleven-count federal indictment for allegedly operating a cryptocurrency Ponzi scheme that diverted more than $1,900,000 in investor funds to himself and his family.
A federal grand jury alleges 47-year-old Misam M. Abidi solicited investors of the cryptocurrency investment firm Star Credit Holdings with claims of guaranteed high returns, a reserve fund to protect principal and inflated representations of total capital under management.
Abidi allegedly provided investors with fictitious account statements and paid purported trading profits using other investors’ principal, which is the hallmark of a Ponzi structure.
The indictment further alleges Abidi helped investors take out loans to funnel additional capital into Star Credit Holdings and falsified at least one affidavit claiming an investor’s identity had been stolen to obtain a loan. He also allegedly failed to report income from the firm on his tax returns.
Says U.S. Attorney D. Michael Dunavant,
“Ponzi schemes, cryptocurrency scams, and financial fraud can be devastating to individual investors, harmful to financial institutions, and detrimental to the U.S. Treasury. We commend our federal agency partners for their outstanding investigation in this egregious case. Wherever fraud occurs in the Western District of Tennessee, this office will be prepared to hold offenders accountable.”
Abidi faces three counts of wire fraud with up to 20 years each and three counts of money laundering with up to 10 years each, along with two counts of operating an unlicensed money transmitting business and three counts of aiding in preparation of false tax returns.
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