A Colorado man with Cedar Rapids ties who has made news locally for his family’s jet-setting lifestyle was charged this week in connection with what federal authorities call a $722 million bitcoin fraud — akin to a high-tech Ponzi scheme.
Identified as Jobadiah Sinclair Weeks, 38, of Arvada, Colo., in court documents, he is among four people named as defendants — with a fifth at large and unidentified — in the alleged ruse involving digital currency.
Weeks “promoted” BitClub Network, which was at the center of the scheme, according to charging documents.
The defendants deployed “elaborate tactics” to lure “thousands of victims with promises of large returns on their investments in a bitcoin mining pool, an advanced method of profiting on cryptocurrency,” said a news release from Craig Carpenito, U.S. Attorney for the District of New Jersey.
“The indictment describes the defendants’ use of the complex world of cryptocurrency to take advantage of unsuspecting investors,” Carpenito said in a statement. “What they allegedly did amounts to little more than a modern, high-tech Ponzi scheme that defrauded victims of hundreds of millions of dollars. Working with our law enforcement partners here and across the country, we will ensure that these scammers are held to account for their crimes.”
The Gazette has reported twice on the Weeks family’s almost too-good-to-be-true globe-trotting adventures in the past year. In the stories, he was identified as “Joby” Weeks — short for Jobadiah.
The story has been told through the lens of Liberty Weeks, the 1-year-old daughter of Joby and wife Stephanie Weeks, a Cedar Rapids native who grew up here and attended Jefferson High. They periodically return to visit family.
Messages to Joby and Stephanie Weeks were not returned.
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At 42 days old, Liberty became the youngest to visit all 50 states, and by 13 months had already visited 45 countries, her family said and documented through photos, videos and social media.
Joby Weeks had ties to former Libertarian and Republican presidential candidate Ron Paul, who was on hand for the delivery of Liberty, and rubbed shoulders with other celebrities.
The lifestyle was supported by Joby Weeks’ early investment in bitcoin, he had told The Gazette in 2018.
He was also an entrepreneur and had online videos and tutorials discussing bitcoin and encouraging investors.
Weeks and Matthew Brent Goettsche, 37, of Lafayette, Colo., were indicted on charges of conspiracy to commit wire fraud, and Goettsche, Weeks, and Joseph Frank Abel, 49, of Camarillo, Calif., were indicted on charges of conspiracy to offer and sell unregistered securities, according to the news release. Silviu Catalin Balaci was later indicted.
According to the news release, from April 2014 through December 2019, the defendants operated BitClub Network, a fraudulent scheme that solicited money from investors in exchange for shares of purported cryptocurrency mining pools and rewarded investors for recruiting new investors. They scheme was bolstered by providing false and misleading figures that BitClub investors were told were “bitcoin mining earnings,” according to the statement.
Goettsche, in messages obtained by federal authorities, referred to their target audience as “dumb” investors, “sheep,” and said he was “building this whole model on the backs of idiots,” according to the news release.
In June 2017, Weeks emailed Goettsche and another saying, “BitClub selling shares in BitClub and then not using the money to purchase mining equipment was ‘not right,’” according to the news release.
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Weeks and the other defendants “obtained the equivalent of at least $722 million from BitClub Network investors,” according to the news release.
Additionally, BitClub did not register its shares, which were securities, with the U.S. Securities and Exchange Commission, according to the news release.
The wire fraud conspiracy charge carries a maximum potential penalty of 20 years in prison, and a fine of up to $250,000. The conspiracy to sell unregistered securities charge carries a maximum penalty of five years in prison and a fine up to $250,000, according to the attorney’s office.
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