The US Department of Justice announced that the founder of the Oyster Pearl cryptocurrency project, Amir Bruno Elmaani, has been charged with operating a tax evasion scheme for millions of dollars and was arrested. The 28-year old Elmaani is charged with two counts of tax evasion, each carrying up to five years in prison.
The protocol, launched several years ago, was advertised as a digital data-storage platform employing the IOTA blockchain to store information. The founder, who went under the name Bruno Block in the online space, used the ICO craze in late 2017 to conduct a token sale that ran from October to November 2017.
In the following months, however, reports started emerging, alleging that Oyster Pearl is a fraudulent project. They asserted that only Elmaani had the authority to print new PRL tokens, despite claiming that the total supply is fixed at nearly 100,000,000.
Nevertheless, he apparently created more of the ERC-20 coins and sold them immediately on the cryptocurrency exchange KuCoin in what the community described as an “exit scam.”
More than two years later, the US DOJ has charged Elmaani with tax evasion. The announcement reads that he made millions of dollars from the sale of the PRL tokens but evaded reporting that income to the IRS. In fact, he filed a false tax return, operated his business through pseudonyms and shell companies, and obtained income through nominees.
Elmaani was also arrested on the same day in Martinsburg, West Virginia, and is scheduled to appear before US Magistrate Judge Robert Trumble in the state’s Northern District.
Acting Manhattan US Attorney Audrey Strauss described Elmaani’s operations as a “high-tech method of financing high-tech businesses, but the underlying scheme was old-fashioned fraud and tax evasion.”
Oyster Pearl’s creator filed a tax return in 2017 stating that his income was about $15,000, and failed to report any funds to the IRS in 2018. However, he spent $1,6 million at a carbon fiber composite company, over $700,000 to purchase two homes, and over $10 million to buy multiple yachts.
FBI Assistant Director William Sweeny said that Elmaani had taken advantage of the “ever-so-popular” cryptocurrency market by defrauding investors through the PRL token. After the arrest, though, Sweeny said that “he won’t be sailing anywhere anytime soon,” referring to the yachts Elmaani had purchased.
Each of the two counts of tax evasion carries a maximum sentence of five years in prison.
