The co-founder of AirBit Club — a cryptocurrency Ponzi scheme that swindled investors of over $100 million — has been sentenced to 12 years in prison.

Seven months earlier, AirBit Club co-founder Pablo Rodriguez pleaded guilty to wire fraud conspiracy charges in a United States district court in March.

In a Sept. 26 statement, Damian Williams, U.S. Attorney for the Southern District of New York, said Rodriguez “preyed” on unsophisticated investors with false promises that their funds were invested into legitimate cryptocurrency trading and mining operations.

“Instead of investing on behalf of investors, Rodriguez hid victims’ money in a complex laundering scheme using Bitcoin, an attorney trust account, and international front and shell companies and used victims’ money to line his own pockets.”

District court Judge George Daniels imposed an additional three years of supervised release for Rodriguez, which will follow his 12-year prison sentence.

The convicted fraudster was ordered to pay a forfeiture of $65 million and to forfeit other items, including a total of 3,800 Bitcoin (BTC), worth around $100 million, Rodriguez’s Irvine residence in California, $900,000 in U.S. dollars seized from the property and nearly $1 million previously held in escrow for a Gulfstream jet.

The other defendants — Dos Santos, Scott Hughes, Cecilia Millan and Karina Chairez — have also pleaded guilty and are awaiting sentencing.

Related: How to tell if a cryptocurrency project is a Ponzi scheme

AirBit Club was launched in 2015. Prospective investors were told that AirBit Club earned returns on cryptocurrency mining and trading and that victims would earn passive, guaranteed daily returns on any membership purchased.

However, as early as 2016, club members wishing to withdraw proceeds were met with excuses, delays and hidden fees and told they must recruit new members to receive the returns.

The club operators, including Rodriguez, were charged with fraud and money laundering by the U.S. Department of Justice in August 2020 after a U.S. Homeland Security Investigations probe.

In 2022, $7.6 billion of funds were lost to cryptocurrency Ponzi and pyramid schemes, according to a June 28 report by blockchain intelligence firm TRM Labs.

Magazine: Unstablecoins: Depegging, bank runs and other risks loom