U.S. Justice Department Moves to Drop Fraud Case Against BitClub Founder

The U.S. Department of Justice is planning to dismiss fraud charges against the founder of crypto mining venture BitClub Network, according to a court filing cited by Fox Business. Defense counsel told the court on Wednesday that the parties had reached a preliminary agreement to drop allegations tied to a $722 million Ponzi scheme case. BitClub Network was launched in 2015 and said it pooled investor money to buy mining equipment and share returns. Prosecutors had alleged that the operation functioned as a Ponzi scheme by falsely reporting mining profits. The founder was also accused of privately describing the model as one built “on the backs of idiots.” The case still has broader legal consequences. Three co-defendants have already pleaded guilty. The Justice Department said it is continuing efforts to recover money for investors and rejected claims that the planned dismissal was connected to political lobbying. The update points to a major turn in one of the better-known crypto mining fraud cases pursued by U.S. prosecutors.