Federal Indictment Alleges $20 Million Investment Scheme

The U.S. Attorney’s Office for the District of South Dakota announced that a federal grand jury returned 29 counts against crypto investor Benjamin Paul Wiener, 43. The DOJ’s 29-count fraud indictment alleges wire fraud, money laundering, bank fraud, and aggravated identity theft involving approximately $20 million in losses across dozens of regional victims.

Wiener pleaded not guilty during his initial court appearance on July 10 and was released on bond pending trial.

According to the indictment, Wiener allegedly persuaded investors to place money and digital assets into companies he controlled by making materially false statements to induce investments.

Prosecutors contend the scheme affected dozens of victims across South Dakota, Minnesota, and neighboring states, and that after investor funds were depleted, Wiener sought fresh investments to finance personal spending and repay earlier participants.

The indictment also alleges Wiener transferred investor funds through financial institutions and cryptocurrency exchanges to conceal their source, ownership, and movement.

Recent DOJ Cases Show Similar Patterns

Federal prosecutors’ allegations against Wiener mirror tactics described in other cryptocurrency fraud prosecutions, where operators allegedly used new deposits to repay earlier investors while presenting the appearance of legitimate investment returns.

Those allegations also align with another federal case in which investor funds moved through exchanges after passing through 81 bank accounts and 19 cryptocurrency exchange accounts, illustrating how investigators reconstruct complex money flows across traditional financial institutions and digital asset platforms.

Although cryptocurrency transactions can span multiple wallets and exchanges, they also create records that help investigators trace funds, obtain seizure warrants, and identify connected accounts. That process was evident in a separate $100 million prosecution in which federal prosecutors recovered crypto proceeds after seizing approximately $7.1 million from cryptocurrency wallets while pursuing more than $24.7 million in restitution.

Crypto Fraud Losses Continue to Climb

Cryptocurrency investment fraud remains one of the costliest forms of cyber-enabled crime in the United States. The Federal Bureau of Investigation (FBI) reported more than $11.36 billion in cryptocurrency-related losses during 2025, a 22% increase from the previous year, while total internet crime losses approached $21 billion.

The FBI published a report in April showing that investment fraud generated the largest share of cryptocurrency losses, with victims averaging more than $62,000 across 181,565 complaints.

The FBI’s cryptocurrency investment fraud guidance advises investors to independently verify companies, investment professionals, custody arrangements, and withdrawal policies before sending funds. The agency also urges victims to preserve transaction records and communications and report suspected fraud to the Internet Crime Complaint Center as quickly as possible.

Bank Fraud Charge Adds Potential 30-Year Sentence

In addition to the investment fraud allegations, prosecutors accuse Wiener of obtaining a $1 million line of credit from a Sioux Falls financial institution in April 2025 by submitting falsified documents and using another person’s identifying information without authorization.

If convicted, Wiener faces potential penalties that include up to 20 years in prison for wire fraud and money laundering, up to 30 years for bank fraud, and a mandatory consecutive two-year sentence for aggravated identity theft. The government also may seek restitution for victims. Wiener remains free on bond, and his federal trial is scheduled to begin Sept. 15, 2026.