A federal jury has convicted Las Vegas businessman Brent C. Kovar of defrauding at least 400 investors of $24 million through a crypto investment scheme.
Kovar owned Profit Connect, a Las Vegas-based company that operated from late 2017 to July 2021 and claimed to use artificial intelligence software on a supercomputer to mine crypto and verify transactions.
Conviction for crypto fraud
According to the U.S. Department of Justice, Kovar falsely represented to investors that Profit Connect was profitable and could provide fixed annual returns of 15 to 30 percent, as well as a 100 percent money-back guarantee.
He also claimed the company was backed by hundreds of millions of dollars in crypto reserves. Prosecutors said Kovar knew the claims were false. Profit Connect was unprofitable, had no cryptocurrency reserves, could not pay the promised returns, and had no legitimate way to provide the money-back guarantee.
Instead, the businessman used investors’ money to keep the business running, buy gifts for his employees and buy himself a house. He also used the funds to repay other investors while making it appear that the money came from crypto mining and verifying transactions.
After a nine-day trial, the jury found Kovar guilty of 11 counts of wire fraud, two counts of mail fraud and two counts of money laundering. Special Agent in Charge Christopher S. Delzotto of the FBI’s Las Vegas Field Office said:
“The victims in this case thought they were participating in a revolutionary technological advancement, but it was simply a deception fabricated by Mr. Kovar’s lies and deception.”
Meanwhile, Special Agent in Charge Ryan Korner of the Federal Deposit Insurance Corporation’s Office of Inspector General said Kovar also falsely represented to investors that their investment was insured by the FDIC. He is scheduled to be sentenced on November 30, 2026 and faces a statutory maximum sentence of 280 years in prison.
Another belief
Furthermore, a federal jury sentenced San Francisco resident Japheth Dillman charged with wire fraud and conspiracy to commit wire fraud after 10-day trial over crypto investment scheme. According to court documents and evidence presented at trial, Dillman, 48, and a co-conspirator defrauded more than 20 investors of nearly $1 million through false statements regarding Block Bits Capital, a crypto trading fund they helped create.
From June 2017 to August 2018, they told investors that the fund would generate profits through automated trading of cryptocurrencies using a software tool called “Autotrader”, which they claimed was complete and operational. The evidence showed that Dillman knew the algorithm was not working and that investors’ funds could not be used as promised.
The money was also used for personal payments and to make risky investments in other crypto companies, which ended up suffering significant losses. Dillman remains free on bond and is scheduled to be sentenced on December 8, 2026. He faces up to 20 years in prison with a fine of $250,000 for each count.
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