A federal jury has convicted Las Vegas businessman Brent C. Kovar of defrauding at least 400 investors of $24 million through a crypto investment scheme.

Kovar owned Profit Connect, a Las Vegas-based company that operated from late 2017 through July 2021 and claimed to use artificial intelligence software on a supercomputer to mine crypto and verify transactions.

Crypto Fraud Conviction

According to the US Justice Department, Kovar falsely told investors that Profit Connect was profitable and could provide fixed annual returns of 15% to 30%, along with a 100% money-back guarantee.

He also claimed the company was backed by hundreds of millions of dollars in crypto reserves. Prosecutors said Kovar knew those claims were false. Profit Connect was not profitable, had no crypto reserves, could not pay the promised returns, and had no legitimate way to provide the money-back guarantee.

Instead, the businessman used money from investors to keep the company operating, purchase gifts for employees, and buy a house for himself. He also used the funds to repay other investors while making it appear that the money had come from crypto mining and transaction verification.

After a nine-day trial, the jury found Kovar guilty on 11 counts of wire fraud, two counts of mail fraud, and two counts of money laundering. Special Agent in Charge Christopher S. Delzotto for the FBI Las Vegas Field Office stated,

“The victims in this case thought they were engaged in revolutionary technological advancement, but it was merely a deception crafted by the falsehoods and trickery of Mr. Kovar.”

Meanwhile, Special Agent in Charge Ryan Korner with the Federal Deposit Insurance Corporation Office of Inspector General said Kovar also falsely told investors that their investment was insured by the FDIC. He is scheduled to be sentenced on November 30, 2026, and faces a statutory maximum penalty of 280 years in prison.

Another Conviction

Separately, a federal jury has convicted San Francisco resident Japheth Dillman of wire fraud and conspiracy to commit wire fraud after a 10-day trial over a crypto investment scheme. According to court documents and evidence presented at trial, Dillman, 48, and a co-conspirator defrauded more than 20 investors of nearly $1 million through false claims about Block Bits Capital, a crypto trading fund they helped establish.

From June 2017 to August 2018, they told investors the fund would generate profits through automated crypto trading using a software tool called “Autotrader,” which they claimed was complete and operational. Evidence showed Dillman knew the algorithm was not working and that investor funds could not be used as promised.

The money was also used for personal payments and to make risky investments in other crypto ventures, which ended up suffering major losses. Dillman remains released on bond and is scheduled to be sentenced on December 8, 2026. He faces up to 20 years in prison with a $250,000 fine for each count.

Source: CryptoPotato