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A Tennessee man has been indicted on federal charges stemming from an alleged cryptocurrency investment fraud that bilked investors across the country out of millions of dollars, the Justice Department announced Friday.
Misam M. Abidi, 47, of Nolensville, Tennessee, faces an 11-count federal indictment accusing him of running a fraudulent crypto investment firm called Star Credit Holdings between 2020 and 2024.
Prosecutors allege Abidi used a web of false promises to lure in investors. Among the misrepresentations he allegedly made: guarantees of high rates of return, claims that he maintained a substantial reserve fund to protect investors, and assertions that he managed far more capital than he actually controlled.
Rather than generating returns through legitimate trading, Abidi allegedly paid earlier investors using money contributed by newer ones—a hallmark of the classic Ponzi scheme structure. He also allegedly helped investors secure personal loans in their own names to funnel additional funds into the firm, and falsified at least one affidavit claiming an investor's identity had been stolen in order to obtain such a loan.
Prosecutors say Abidi diverted more than $1.9 million of investor funds to himself and family members, and also failed to report income from the operation on his federal tax returns.
"Ponzi schemes, cryptocurrency scams, and financial fraud can be devastating to individual investors, harmful to financial institutions, and detrimental to the U.S. Treasury,” said U.S. Attorney D. Michael Dunavant, in a statement. “We commend our federal agency partners for their outstanding investigation in this egregious case. Wherever fraud occurs in the Western District of Tennessee, this office will be prepared to hold offenders accountable."
The indictment includes charges of wire fraud, operating an unlicensed money transmitting business, aiding in the preparation of false tax returns, and money laundering. If convicted on all counts, Abidi could face decades in federal prison.
