Dallas-based AriseBank’s chief exec has been sentenced to five years behind bars after he admitted to defrauding investors out of more than $4 million in fiat and cryptocurrency with his ICO scam.
A Texas Federal court sentenced Jared Rice Sr. this week after he pleaded guilty to one count of securities fraud over his role at AriseBank, reports Latin Times.
The 33-year-old claimed AriseBank offered investors bank accounts insured by the Federal Deposit Insurance Corporation (FDIC), alongside Visa debit and credit cards.
Rice also tempted marks with promises of crypto-related services powered by the platform’s own cryptocurrency, AriseCoin, which he sold in an initial coin offering (ICO) in late 2017.
These and other bold claims (Rice said AriseBank was a “banking revolution”) saw eager investors pump a total of $4.25 million in fiat and crypto into AriseCoin.
As it turned out, AriseBank didn’t have authorization to offer such services in Texas. Not only that, it wasn’t FDIC insured and had no partnership with Visa.
The Feds subsequently charged Rice in 2018 over his ICO scam. He pleaded guilty the following year.
It was later revealed Rice used investor funds to support an increasingly luxurious lifestyle. The SEC noted he’d spent millions on legal fees, food, hotels, and transportation.
Convicted felon pulls ICO scam, what could go wrong?
Rice was no stranger to legal troubles when he launched AriseCoin.
In 2015, authorities charged Rice with public record tampering after he forged signatures and seals of the Secretary of State on incorporation documents.
At the same time, Rice faced charges of stealing investor funds.
Still, Rice can count himself somewhat lucky. Despite facing five years in the clink, earlier reports speculated he may be looking at up 120 years inside.
Prefer to listen to your news? The Protos Podcast delivers the week’s top stories every Friday.