SPOKANE, Wash. — A Spokane man was sentenced for stealing $350,000 from investors in a cryptocurrency scheme.
According to the U.S. Attorney’s Office and court documents, Michael McElhiney, 38, defrauded investors by posing as the operator of a cryptocurrency investment fund called MAC Blockchain Solutions. The scheme occurred between March 4, 2021, and Sept. 10, 2022. McElhiney promised prospective investors that he and his alleged business partners ran a successful cryptocurrency investment fund that invested in emerging cryptocurrencies and other blockchain-based projects, such as Ethereum staking and cryptocurrency liquidity pools.
According to the prosecutor’s office, McElhiney typically contacted victims in person, including Uber drivers he met during rides and women he encountered through dating apps. He also met victims online while playing the video game Call of Duty under the username “Bing Bong.” McElhiney often met with victims multiple times, developing personal relationships before soliciting and receiving funds.
McElhiney promised to invest the victims’ money and manage their investments. He assured them they could withdraw their funds at any time and guaranteed returns on their investments. He provided information through a platform called Coin.FYI that appeared to track the progress of the investments. However, McElhiney did not invest the funds and instead used them for personal expenses, including gambling at casinos. The Coin.FYI accounts he showed to investors were fabricated to create the illusion of growing investments.
McElhiney defrauded investors of more than $350,000, including cash, rare art and precious metals.
When victims attempted to withdraw their investments, McElhiney falsely claimed that various issues, including security breaches, his absence from the country, theft, and problems with payment processing platforms, prevented the return of their funds.
“Today’s sentencing serves as a clear reminder that those who prey on the trust of others through fraudulent schemes will be held accountable,” said Matthew Murphy, acting special agent in charge of HSI Seattle. “This individual exploited the allure of digital currency to deceive and steal from countless investors. We remain committed to investigating and prosecuting those who attempt to manipulate others for personal gain, regardless of the platform or technology they use. We appreciate the tireless work of our law enforcement partners and the U.S. Attorney’s Office to bring individuals like McElhiney to justice.”
McElhiney was sentenced to 41 months in federal prison, three years of supervised release, and ordered to pay $326,119.95 in restitution.
