Damian Williams, the United States Attorney for the Southern District of New York, announced announced that PHILIP REICHENTHAL, a disbarred attorney, pled guilty in Manhattan federal court to conspiracy to commit wire fraud, in connection with a scheme to defraud investors who believed they were purchasing Bitcoin. Reichenthal engaged in the scheme with Randy Craig Levine, a/k/a “Viktor Lapin,” a/k/a “Andre Santiago Santos Galindo,” a/k/a “Alexander Martinez Lavrov,” a/k/a “Alexander Kozlov,” a/k/a “Hristo Danielov Marinov,” an international fugitive who fraudulently induced victims to send millions of dollars to REICHENTHAL, who was a licensed attorney at the time of the fraud. REICHENTHAL falsely represented that he would act as an escrow agent for the transactions, but instead, he sent a substantial portion of the money to Levine, before any Bitcoin was provided by Levine to investors. Neither Levine nor REICHENTHAL ever provided any Bitcoin or refunded the investors’ money.
REICHENTHAL was arrested on September 14, 2020, and pled guilty before U.S. Magistrate Judge Debra Freeman.
U.S. Attorney Damian Williams said: “As a licensed attorney and escrow agent, Philip Reichenthal was entrusted to keep investors’ money safe. But as he admitted today, he betrayed that trust by siphoning millions of dollars of investor money. Now he stands guilty of wire fraud and awaits sentencing for his crime.”
As alleged in the Complaint and Indictment filed against REICHENTHAL, as well as his co-conspirator Levine,[1] and other statements made in open court:
The charges against Levine and REICHENTHAL involve two fraudulent schemes. In the first fraudulent scheme, in approximately June and July 2018, Levine induced another individual, the principal of a purported cryptocurrency escrow firm (“Individual-1”), to wire to REICHENTHAL over $3 million of funds from an over-the-counter cryptocurrency broker (“Company-1”) to fund the purchase of Bitcoin after falsely telling Individual-1 that Levine would sell thousands of Bitcoin, when in truth and in fact, Levine never intended to sell Bitcoin. After receiving the $3 million, REICHENTHAL, in turn, wired over $2 million to bank accounts in Guatemala held in the name of one of Levine’s aliases. Levine then lied to Individual-1 for days about why the deal had not worked out, the status of the purported Bitcoin, and the location of Company-1’s money, which was never returned.
In the second fraudulent scheme, from approximately February 2019 to May 2019, Levine induced a Florida resident involved in brokering Bitcoin transactions (“Individual-2”) to cause investors to send to REICHENTHAL over $2 million of the investors’ money to fund the purchase of Bitcoin. Again, Levine told Individual-2 that Levine would sell Bitcoin, when in truth and in fact, Levine never had any intention of selling Bitcoin to the investors. After receiving the funds from the investors, REICHENTHAL, in turn, sent over $1.9 million to bank accounts in Mexico controlled by Levine; the money was then wired to a bank account in Russia held in the name of one of Levine’s aliases. Levine then lied to Individual-2 and an investor about the status of the investors’ funds, which were never returned.
In connection with the above transactions, Levine used, among other things, various false aliases to communicate with the individuals sending funds to REICHENTHAL and foreign bank accounts held in his false names. REICHENTHAL used bank accounts held in the name of his law firm and an attorney trust account to receive the funds and the pass them to Levine, before he or investors received the Bitcoin, contrary to REICHENTHAL’s and Levine’s promises.
REICHENTHAL, 78, of Homestead, Florida, pled guilty to one count of conspiracy to commit wire fraud. This charge carries a maximum term of twenty years in prison. The maximum potential sentence in this case is prescribed by Congress and is provided here for informational purposes only, as any sentencing of the defendant will be determined by the judge.
REICHENTHAL will be sentenced at a later date by the Honorable Lewis A. Kaplan.
Extradition proceedings against Levine are pending.
Mr. Williams praised the investigative work of the Federal Bureau of Investigation.
[1] As the introductory phrase signifies, as to Levine, the entirety of the text of the Indictment, and the description of the Indictment set forth herein, constitute only allegations, and every fact described should be treated as an allegation.
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