Head of AriseBank Faces 120 Years in Prison
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Nov. 29, 2018
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The Federal Bureau of Investigation (FBI) arrested the CEO of the AriseBank cryptocurrency project Jared Rice. He was charged with organizing a fraudulent scheme.

Jared Rice advertised AriseBank as “the first decentralized bank”. The entrepreneur promised investors bank accounts insured by the Federal Deposit Insurance Corporation (FDIC), Visa-related debit and credit cards, and cryptocurrency services based on AriseCoin's own token.

The Northern District of Texas Prosecutor’s Office believes that AriseBank actually was not authorized to conduct banking operations in Texas, was not insured by the FDIC, and did not have any partnerships with Visa. Prosecutors say Rice scammed the investors by $4 million.

Rice is also charged with spreading false information about raising $600 million in less than a month through the ICO. It is also considered that Rice squandered the money of deceived investors for their needs, for example, the entrepreneur paid for hotels, bought food and clothes.

AriseBank: Most Cunning ICO out there

The arrested entrepreneur promoted AriseBank and AriseCoin created by him through various press releases, interviews, social media and personal websites. If the court pleads guilty to Rice, he faces 120 years in prison.

Recall, this is the first time that Rice has been put on trial. Earlier this year, he was sued by the U.S. Securities and Exchange Commission (SEC). Together with their partner Stanley Ford, they were accused of implementing unregistered tokens during the ICO. It is noteworthy that one of the top individuals who advertised the project was the famous boxer Evander Holyfield.

The SEC’s main allegations against AriseBank included frauds with unregistered securities, misleading users about cooperation with the Federal Deposit Insurance Corporation and the possibility of obtaining a VISA card for the convenient calculation in cryptocurrency.

Report: Most ICOs Are Fraud

In addition, back then the SEC stressed that the organizers of AriseBank had concealed the criminal past of the project leaders. Rice was on probation on a plea bargain. In 2015, he was charged with theft and forgery of government papers.

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