California resident John DeMarr was charged in a complaint unsealed Monday by the US Department of Justice for allegedly participating in a cryptocurrency and securities fraud scheme.

The complaint, originally filed in the US District Court for the Eastern District of New York (EDNY) on January 29, charged DeMarr with one count of conspiracy to commit securities fraud between November 2017 and May 2018. The complaint alleged that DeMarr and his co-conspirators, two American citizens who resided in Arizona and California but whose names have not been determined at this time, were responsible for defrauding investors of approximately $11.4 million while appearing to be appropriately investing the investors’ Bitcoin, Ethereum, and fiat money.

DeMarr and his co-conspirators allegedly created a complex front involving the creation of a Bitcoin “ecosystem” that would allow the investors to trade with one another using tokens within DeMarr’s two companies, “Start Options” and “B2G.” After luring investors to use his companies’ services with promises of up to 8000 percent returns on their investments, false press statements, and other fake marketing, DeMarr allegedly diverted the funds into private accounts controlled by him and others, both in the US and internationally, and provided investors with fake statements and simulated earnings on their investments. After investors became suspicious, DeMarr published fake statements claiming that he had gone missing after being assaulted in Montenegro.

In regard to DeMarr’s charges, acting US Attorney Seth DuCharme of the EDNY said, “DeMarr made misrepresentations and false promises that coaxed investors into pouring millions of dollars into fraudulent cryptocurrency schemes, all to facilitate his extravagant lifestyle. … We will continue to root out and prosecute those who would cheat investors to line their own pockets.”