Five people have been accused in a newly published charge with “conspiring to manipulate the market” in connection with an alleged conspiracy employing the ERC-20 Hydro (HYDRO) token.
Manipulation of Hydro Token Price Action
According to a statement issued by the US Department of Justice on April 24, the indictment charged three persons with conspiracy for manipulating the Hydro market. Two other people were charged separately for allegedly taking part in the conspiracy.
The DOJ claims that from June 2018 to April 2019, Michael Ross Kane, ex-CEO of Hydrogen Technology Corp., Shane Hampton, chief of financial engineering of Hydrogen, and George Wolvaardt, CTO of Moonwalkers Trading Limited scammed those who were seeking to trade the Hydro tokens issued by Hydrogen.
$2M in Unjustified Gains
As per the charges, Wolvaardt created a bot for trading that issued several high-value “spoof orders” at random intervals to create a feeling of a massive demand regarding the token.
The DOJ asserts that after the alleged artificial manipulation of Hydro’s price, the co-conspirators liquidated significant portions of their shares, collecting around $2 million in unjustified gains.
Hydro Scammers Face Up to 5 Years in Prison
Tyler Ostern and Andrew Chorlian were also accused in connection with the suspected manipulation operation.
Each of Kane, Hampton, and Wolvaardt faces one conspiracy charge for manipulating the price of stocks, one conspiracy charge for wire fraud, and two wire fraud charges.
If found guilty on all allegations, they risk a potential sentence of up to five years in jail for conspiracy to conduct securities price manipulation and an enormous 20 years in prison for each of the other accusations.
Ostern and Chorlian face a single charge for both conspiracy to engage in securities price manipulation and wire fraud. They risk a maximum sentence of five years in jail if proven guilty.
DoJ’s Fight Against Crypto Scammers
The DoJ has gained several important wins in its fight against criminal groups. According to a recent statement from the U.S. Department of Justice (DoJ), six digital currency accounts linked to cryptocurrency investment fraud have been seized.