Middle Tennessee man indicted for crypto Ponzi scheme
U.S. Attorney's Office, Western District of Tennessee
Memphis – A federal grand jury in the Western District of Tennessee returned an 11-count indictment charging a middle Tennessee man with multiple crimes related to his running of a cryptocurrency Ponzi scheme while a resident of Shelby County. United States Attorney D. Michael Dunavant announced the indictment today.
As alleged in the indictment, Misam M. Abidi, 47, of Nolensville, Tenn., executed a scheme to defraud millions of dollars from investors across the country through his cryptocurrency investment firm, Star Credit Holdings, between 2020 and 2024. Abidi made a variety of misrepresentations to his investors in order to convince them to invest in Star Credit Holdings. These misrepresentations included: 1) guaranteed high rates of return, (2) that Abidi had a significant reserve fund to make his investors whole if necessary, and (3) that Abidi had substantially more capital under his management than he actually did.
The indictment alleges that Abidi provided the Star Credit Holdings investors with fictitious statements, as well as returns that were purportedly from trading activity but were the investment principal of other investors. Moreover, Abidi helped his investors take out loans in their names to provide them with greater access to funds to invest with Star Credit Holdings. Abidi, with the knowledge of at least one investor, falsified an affidavit stating that the investor’s identity had been stolen to take out the loan. Abidi diverted over $1,900,000 of investor funds to himself and his family. Additionally, Abidi failed to report income from his Star Credit Holdings business on his income tax returns.
The indictment alleges 3 counts of wire fraud, 2 counts of operating an unlicensed money transmitting business, 3 counts of aiding and assisting in the preparation of false tax returns, and 3 counts of money laundering. If convicted, Abidi faces a maximum penalty of 20 years for each count of wire fraud, 5 years for each count of operating an unlicensed money transmitting business, 3 years for each count of preparing false tax returns, and 10 years for each count of money laundering. There is no parole in the federal system.
U.S. Attorney D. Michael Dunavant said, "Ponzi schemes, cryptocurrency scams, and financial fraud can be devastating to individual investors, harmful to financial institutions, and detrimental to the U.S. Treasury. We commend our federal agency partners for their outstanding investigation in this egregious case. Wherever fraud occurs in the Western District of Tennessee, this office will be prepared to hold offenders accountable."
“Schemes that rely on deception, fictitious investment statements, and the misuse of loan proceeds undermine the integrity of our financial system and erode the trust of honest taxpayers,” said Special Agent in Charge Donald “Trey” Eakins, Charlotte Field Office, IRS Criminal Investigation. “Our special agents are committed to following the money, uncovering complex financial schemes, and bringing to justice those who abuse our tax and financial infrastructure for their own benefit.”
This case was investigated by the Internal Revenue Service-Criminal Investigation, the Federal Bureau of Investigation, and the United States Secret Service.
Assistant United States Attorney William Carey Bateman III, for the Western District of Tennessee, is prosecuting the case on behalf of the government.