Former Somers Resident Sentenced In $9M Virtual Currency Fraud

Matt Dwyer
September 13, 2018 - 5:10 pm

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(WTIC-AM) -- In Hartford Federal Court today, a former Somers resident was sentenced to almost 2-years in prison, for his role in a $9-million virtual currency fraud. 

Virtual currencies like bitcoin and etherium have attracted a lot of attention in recent years, and Joshua Garza allegedly used some of that interest to attract investors for his virtual currency companies.  

But federal prosecutors say companies called GAW, GAW Miners, ZenMiner, and ZenCloud sold those investors a share of their computer time, when they did not have enough computer power to provide all of the resources promised to the investors.  

Garza's companies also claimed to have a $100-million reserve fund backing up their virtual currency, called PayCoin.

But federal prosecutors say no such fund existed.  

The judge also ordered Garza to repay $9-million defrauded from investors around the world. 

The 33-year-old had already pleaded guilty to wire fraud.  

Garza now lives in Texas.