My Big Coin Executives Ordered to Pay $26 Million for Fraud

A federal court in Massachusetts has ordered My Big Coin, a cryptocurrency and virtual payment services company, and its executives Mark Gillespie and John Roche to pay a total of approximately $26 million in penalties for defrauding investors. The court's decision mandates that the defendants pay $19.32 million in civil monetary penalties and $6.44 million in restitution to the victims of their fraudulent scheme. The Commodity Futures Trading Commission (CFTC) has also imposed a permanent ban on trading and registration for the defendants, prohibiting them from participating in any CFTC-regulated markets or entering into transactions involving commodity interests or digital asset commodities.

The CFTC alleged that Gillespie, Roche, and another operator, Michael Kruger, defrauded investors through My Big Coin (MBC) between January 2014 and June 2017, defrauding at least 28 investors out of more than $6 million. The defendants solicited investments in My Big Coin by falsely claiming that the token was backed by gold and actively traded on established exchanges. These misrepresentations led to significant losses for investors. The CFTC has cautioned that the victims are unlikely to recover their losses, as the defendants may lack sufficient assets to cover the restitution.

My Big Coin was marketed as a fully functioning virtual currency through My Big Coin Pay Inc. The company offered payment services using its proprietary token, falsely claiming it was backed by tangible assets such as oil and gold, and fabricated ties to major financial networks. From 2014 to 2017, the defendants used social media, email, and promotional websites to solicit investor funds, promising that their digital assets could be exchanged seamlessly for fiat or other cryptocurrencies. However, the infrastructure to support these claims never existed.

The CFTC filed a civil enforcement action against My Big Coin in 2018, alleging violations of the Commodity Exchange Act. This case marked one of the first instances where a US court recognized a virtual currency as a commodity under the regulator’s jurisdiction. The founder of the company, Randall Crater, was arrested following a grand jury indictment in 2022 and was convicted in July that year on multiple counts, including wire fraud, unlawful monetary transactions, and operating an unlicensed money-transmitting business. He was sentenced to 100 months in prison in January 2023.

With the court’s decision, the CFTC has concluded its enforcement action against Gillespie, Roche, and the two Nevada-based corporate entities. Charges against another named defendant, Michael Kruger, were dropped following his death, while Crater, the central figure in the scheme, had already reached a separate settlement with the CFTC and is currently serving a federal prison sentence.