Cryptojacker Gets 1 Year Prison for $3.5M Fraud Scheme

Crypto Influencer Sentenced for Multi-Million Dollar Fraud

A crypto influencer has been sentenced to one year and one day in prison for orchestrating a large-scale cryptojacking operation that defrauded two major cloud computing providers of over $3.5 million in resources.

Charles O. Parks III, also known by his online persona "CP3O," was sentenced by a Brooklyn federal court on Friday following his guilty plea to wire fraud charges in December 2024.

What is Cryptojacking and How Parks Exploited It

Cryptojacking occurs when computing resources or electricity are used without permission to mine cryptocurrency. Parks exploited this method by using fake corporate identities to gain unauthorized access to cloud computing services.

Between January and August 2021, Parks created fraudulent companies including "MultiMillionaire LLC" and "CP3O LLC" to deceive two unidentified cloud providers into granting him elevated computing privileges.

The $3.5 Million Deception Scheme

Using his fabricated corporate identities, Parks successfully mined nearly $1 million worth of cryptocurrency, including:

• Ethereum (ETH)

• Litecoin (LTC)

• Monero (XMR)

The total cost to the cloud computing providers exceeded $3.5 million in stolen resources and services.

False Business Claims Led to Resource Access

According to Department of Justice prosecutors, Parks told one provider he intended to use computing resources to build an online training company focused on media, technology, and business strategy. He claimed the platform would serve 10,000 students.

However, prosecutors revealed that no training company existed, and there were no students. The resources were exclusively used for cryptocurrency mining operations.

Money Laundering Through Luxury Purchases

Parks laundered the illegally mined cryptocurrency through multiple channels, including crypto exchanges, NFT marketplaces, online payment processors, and traditional banks.

The converted funds were used to purchase luxury items including:

• A Mercedes-Benz vehicle

• Expensive jewelry

• First-class travel accommodations

Building False Credibility as Crypto Influencer

Prosecutors revealed that Parks used his illegal profits to build credibility as a cryptocurrency influencer online. He shared investment tips and promoted what he called a "MultiMillionaire Mentality" through social media content, including a September 2022 YouTube video.

His website promoted a subscription-based self-improvement and wealth coaching program priced at $10 per month, with optional one-on-one consulting services available for $150 monthly. The program included rewards paid in his own cryptocurrency token.

Legal Consequences and Forfeiture Orders

Parks initially faced charges of wire fraud, money laundering, and unlawful transactions that carried a potential maximum sentence of 50 years in prison. After pleading guilty to wire fraud, he received the reduced sentence.

The court ordered Parks to forfeit $500,000 and surrender his Mercedes-Benz vehicle. Additional restitution amounts will be determined at a future court hearing.

Law Enforcement Response

New York City Police Department Commissioner Jessica S. Tisch commented on the sentencing: "Charles Parks manipulated technology, stole millions in computer resources, and illegally mined cryptocurrency — and today's sentencing holds him fully accountable for his deceitful actions."

US Attorney Joseph Nocella Jr emphasized that Parks was not the innovation leader he portrayed himself to be, stating: "In the end he was merely a fraudster whose secret to getting rich quick was lying and stealing."

Impact on Cloud Computing Industry

This case highlights the vulnerability of cloud computing providers to sophisticated fraud schemes and the importance of enhanced verification processes for new corporate accounts.

The incident involved subsidiaries of major technology companies, including firms headquartered in Seattle, Washington and Redmond, Washington, though the specific companies were not identified in court documents.

Cryptocurrency Mining Fraud Trends

The Parks case represents a growing trend of cryptocurrency-related fraud schemes targeting legitimate business services. As cryptocurrency mining becomes more resource-intensive, fraudsters increasingly target cloud computing services to avoid the substantial electricity and hardware costs associated with legitimate mining operations.

This sentencing serves as a warning to others considering similar schemes and demonstrates law enforcement's commitment to prosecuting cryptocurrency fraud cases.

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