Tiktok Influencer Enters Guilty Plea For Crypto Laundering Over $400,000

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Key takeaways:

  • A TikTok influencer used bitcoin to launder loans for COVID relief totaling $420,000.
  • The 31-year-old social media star entered a guilty plea to money laundering, wire fraud, and aggravated identity theft.

Former TikTok influencer and crypto investor admits guilt in wire fraud, aggravated identity theft, and money laundering charges. The individual utilised cryptocurrency to launder unlawfully acquired COVID-19 relief funds, totaling thousands of dollars. Additionally, he distributed a portion of the illicit proceeds to his girlfriend.

According to a press statement from the U.S. Attorney’s Office for the District of Maryland, the influencer attempted to defraud lenders and the federal government of $1.2 million in COVID-19 relief loans. 

With 26,000 followers at the time of his arrest, Danny Devan’s TikTok videos about stock and cryptocurrency investing made him a household name. According to Business Insider, Sahadevan had more than 630,000 followers  when he blew up on tiktok.

A 31-year-old influencer pleaded guilty to charges of wire fraud, aggravated identity theft, and money laundering. The individual, Sahadevan, confessed to creating false documents to fraudulently apply for eight Economic Injury Disaster loans (IEDLs) worth $283,900 and Paycheck Protection Program (PPL) loans worth $941,794.75.

 He received $146,000 from the PPL loans and obtained the full amount from the IEDL benefits, as confirmed by the attorney’s office.

Subsequently, he attempted to secure a $1.3 million loan to acquire a luxurious six-bedroom, six-bathroom mansion in Potomac, Maryland. However, this loan was also deceptive as Sahadevan failed to disclose his outstanding debt of $283,900 owed to the government from the previous EIDL benefits he received.

It is significant to remember that the United States government passed the Coronavirus Aid, Relief, and Economic Security (CARES) Act at the start of the pandemic to help Americans who were affected financially by COVID-19 measures. This included Paycheck Protection Programmes (PPP) and Economic Injury Disaster Loans (EIDL), both of which, according to US prosecutors, were utilised by Devan for his financial scams. 

Under the terms of his plea agreement, Sahadevan will surrender the cash and Bitcoin seized during the February 24, 2023 search. He will also be obligated to pay restitution and a forfeiture money judgement of at least $429,906.

Sahadevan could face a maximum sentence of 20 years in federal prison for wire fraud, up to 10 years in federal prison for money laundering, and a mandatory two-year sentence in federal prison for aggravated identity theft, to be served consecutively with any other imposed sentence. 

It is evident that authorities are taking significant steps towards implementing a systematic crackdown on influencers who attempt to manipulate the cryptocurrency industry. The development in  Danny Devan’s case comes shortly after, a former SEC employee recently forecasted an upcoming crackdown on cryptocurrency influencers, signalling the need for tougher laws to protect investors and uphold market integrity.

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Aadrika Sharma
Aadrika Sharma

I enjoy writing and try to learn new things every passing day!

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