US Prosecutors Seek Lengthy Sentence for Crypto Shadow Bank Executive

US prosecutors are searching for a prolonged sentence for Reginald Fowler, a former minority proprietor of the Minnesota Vikings NFL staff, over his alleged involvement in shadow banking practices by way of Crypto Capital Corp, an alleged crypto shadow financial institution. Fowler’s sentencing is scheduled for April 20, following his arrest in 2019 and subsequent cost with financial institution fraud, unlawful cash transfers, and conspiracy linked to his operation of an unlicensed cash transmitting enterprise.

In a request filed on April 18, US District Lawyer Damian Williams requested a sentence of not less than seven years imprisonment for Fowler, with a prompt vary of 15 to twenty years to mirror the seriousness of the offense. Williams argued that Fowler’s actions as an unlicensed cash transmitter and his alleged deception of monetary establishments warranted a big penalty.

Fowler established a agency referred to as International Buying and selling Options (GTS) in 2018 below the umbrella of the Panama-based Crypto Capital Corp, an alleged crypto shadow financial institution. Via GTS and Crypto Capital, Fowler is alleged to have offered shadow banking providers to a number of crypto exchanges together with Bitfinex, Binance, CEX.io, and QuadrigaCX. Between February and October 2018, GTS and Crypto Capital processed roughly $750 million in cryptocurrency transactions, offering unlicensed crypto companies with illegal entry to the U.S. banking system, based on the submitting.

Using shadow banking practices by Crypto Capital and GTS got here to mild in the course of the courtroom case relating to Bitfinex’s failure to reveal the lack of $850 million in buyer funds. Fowler and Crypto Capital have been recognized as key gamers within the case, which was settled in February 2022 with the companies ordered to pay $18.5 million in civil penalties and shut down New York buying and selling operations.

The alleged involvement of Fowler and Crypto Capital in shadow banking practices highlights the dangers related to unlicensed cash transmitting companies and the potential for unlawful actions to happen inside the crypto trade. The case additionally underscores the necessity for stronger regulation and oversight of crypto exchanges and shadow banking practices to stop illicit actions and make sure the integrity of the monetary system.