Father And Son Charged In Manhattan Federal Court With Multimillion-Dollar Cryptocurrency-Related Crimes

 

Hugh and Brandon Austin are Allegedly Responsible for More than $10 Million in Losses to Over 20 Victims

 Damian Williams, the United States Attorney for the Southern District of New York, and Ivan J. Arvelo, the Special Agent in Charge of the New York Field Office of Homeland Security Investigations (“HSI”), announced today the arrest of EUGENE WILLIAM AUSTIN, JR., a/k/a “Hugh Austin,” for charges in connection with a scheme to steal money from investors and other victims by offering a variety of fraudulent cryptocurrency-related investment services, including sales of multimillion-dollar batches of cryptocurrency, marketing and advertising services, and short-term investments and loans.  EUGENE AUSTIN was arrested on July 5, 2023, and was presented that same day before U.S. Magistrate Judge Jennifer E. Willis.  Mr. Williams also announced the guilty plea of EUGENE AUSTIN’s son, BRANDON P. AUSTIN, who pled guilty on April 13, 2023, before U.S. District Judge P. Kevin Castel to participating in a money laundering conspiracy with his father, EUGENE AUSTIN, relating to his involvement in conducting financial transactions with the intent to conceal proceeds of fraud. 

HSI Special Agent in Charge Ivan J. Arvelo said: “The charging of Hugh and Brandon Austin reflects our ongoing commitment to thwarting individuals involved in all types of financial crimes, especially those that affect the digital environment and subsequently impact the security of our economy.  As alleged, these sophisticated scammers exploited the novelty of digital currency to defraud unsuspecting investors out of millions of dollars, while utilizing it as a cover to engage in illicit activity.  HSI commends the prosecutorial team at the Southern District of New York’s Complex Frauds and Cybercrime Unit for their unwavering support.”

According to the allegations in the Complaint, which was unsealed today in Manhattan federal court, as well as publicly filed court documents and statements made at public court proceedings:[1]

EUGENE WILLIAM AUSTIN, JR. participated in a scheme with his son BRANDON P. AUSTIN and others to steal money from investors and other victims by fraudulently offering to, among other things: (i) serve as a broker for sales of large quantities of cryptocurrency at below-market exchange rates; (ii) provide short-term investments in cryptocurrency for purportedly high returns; and (iii) provide marketing and advertising services to small businesses, while knowing that, in fact, EUGENE AUSTIN and BRANDON AUSTIN would not provide the promised cryptocurrency, returns, or services.  EUGENE AUSTIN also frequently sought personal loans from friends and acquaintances in connection with his purported cryptocurrency and investment businesses, falsely promising to pay lenders back with interest.  In each instance, investors and lenders lost their money, and EUGENE AUSTIN and BRANDON AUSTIN frequently spent investors’ funds on personal expenses, including airline travel, luxury hotels, restaurants, and shopping, as well as nominal payments to victims to prolong the scheme.  In total, EUGENE AUSTIN and BRANDON AUSTIN have caused more than $10 million in losses to over 20 victims.  Below are several examples of victims defrauded by AUSTIN and BRANDON:

• In or about February 2018, EUGENE AUSTIN and BRANDON AUSTIN fraudulently induced a Japanese cryptocurrency company to conduct an interstate cryptocurrency transaction for approximately $600,000 worth of cryptocurrency, for the purported purchase of fundraising and marketing services, which were never provided to the victim.

• In or about August 2018, EUGENE AUSTIN and BRANDON AUSTIN fraudulently induced a partner at a California-based investment firm to send an interstate wire transfer of approximately $5 million to a Manhattan-based attorney, for the purported purchase of cryptocurrency, which was never provided to the victim.

• In or about September 2018, EUGENE AUSTIN and BRANDON AUSTIN fraudulently induced a cryptocurrency start-up company to send an interstate wire transfer of approximately $100,000 for a purported cryptocurrency investment opportunity with high returns; instead of using the funds as promised, EUGENE AUSTIN and BRANDON AUSTIN spent the money on gas, restaurants, hotels, flights, and cash withdrawals.

• In or about January 2019, EUGENE AUSTIN and BRANDON AUSTIN fraudulently induced the founder and chairman of a New Jersey- and Hong Kong-based cryptocurrency investment firm to send an interstate wire transfer of approximately $4 million to a Georgia-based attorney for the purported purchase of cryptocurrency, which was never provided to the victim.

• In or about June 2020, EUGENE AUSTIN and BRANDON AUSTIN embezzled approximately $776,000 that had been sent via an interstate wire transfer to the trust account of a New York-based real estate attorney for the purported purchase of cryptocurrency.

• In or about October 2021, EUGENE AUSTIN and BRANDON AUSTIN embezzled approximately $574,000 that had been sent via an interstate wire transfer to the bank account of a Manhattan-based investment firm for the purported purchase of cryptocurrency.

In connection with BRANDON AUSTIN’s guilty plea, he forfeited his rights and interest in a 2022 E-Pace P250 Jaguar, depicted below:

EUGENE WILLIAM AUSTIN, JR., 60, of Port Jefferson, New York, is charged with one count of conspiracy to commit wire fraud, which carries a maximum sentence of 20 years in prison; one count of conspiracy to commit money laundering, which carries a maximum sentence of 10 years in prison; and one count of conspiracy to commit interstate transportation of stolen property, which carries a maximum sentence of five years in prison.

BRANDON P. AUSTIN, 27, of Coram, New York, pled guilty to one count of conspiracy to commit money laundering, which carries a maximum penalty of 20 years in prison.  In connection with the guilty plea, BRANDON AUSTIN also agreed to forfeit $3,406,450 and to make restitution to victims in the amount of $1,985,251.  BRANDON AUSTIN is scheduled to be sentenced on September 6, 2023, at 12:00 p.m., by Judge Castel. 

The maximum potential sentences are prescribed by Congress and are provided here for informational purposes only, as any sentencing of each defendant will be determined by the judge.

Mr. Williams praised the investigative work of HSI.

This case is being handled by the Office’s Complex Frauds and Cybercrime Unit.  Assistant U.S. Attorneys Andrew K. Chan, Sarah Lai, and Olga I. Zverovich are in charge of the prosecution.

The charges contained in the Complaint are merely accusations and the defendant, EUGENE WILLIAM AUSTIN, JR., a/k/a “Hugh Austin,” is presumed innocent unless and until proven guilty.

[1] As the introductory phrase signifies, the entirety of the text of the Complaint and the description of the Complaint set forth herein constitute only allegations, and every fact described herein should be treated as an allegation.

BRONX PARENTS INDICTED IN DEATH OF THEIR 3-MONTH-OLD DAUGHTER AND FOR DISPOSING CHILD’S BODY NEAR EXPRESSWAY

 

Child’s Father Allegedly Shook Baby, Causing Her Death; Infant’s Body Was Found Weeks Later

 Bronx District Attorney Darcel D. Clark today announced that a Bronx father has been indicted in the murder of his infant daughter, and he and the baby’s mother have been indicted on charges of disposing the child’s body in a desolate area near Yankee Stadium.

 District Attorney Clark said, “The father of three-month-old Genevieve Comager allegedly shook the infant because she would not stop crying, leading to her death. The infant’s mother and father both allegedly placed her in a plastic bag and left her in a garbage ridden wooded area beside the Major Deegan Expressway. The alleged actions of these defendants are outrageous. They showed complete disregard for this innocent child, both in life and death. We will seek justice for little Genevieve.”

 District Attorney Clark said the defendant, Damion Comager, 23, was arraigned today on second-degree Murder, first-degree Manslaughter, second-degree Manslaughter, Tampering with Physical Evidence, two counts of Concealment of a Human Corpse and second-degree Obstructing Governmental Administration before Bronx Administrative Judge Alvin Yearwood. He was remanded. Ivana Paolozzi, 20, was arraigned June 20, 2023 on Tampering with Physical Evidence, two counts of Concealment of a Human Corpse and second-degree Obstructing Governmental Administration. Paolozzi was placed on electronic monitoring with supervised release. The defendants are due back in court on September 12, 2023.

 According to the investigation, between May 10, 2023 and May 16, 2023, the defendants were living in a homeless shelter with the infant at 1041 University Avenue. Comager allegedly shook his three-month-old daughter, causing her death. Comager and Paolozzi then allegedly dressed the infant and placed her in a stroller, walked out of the shelter and went to a nearby wooded area, near 161st Street and the Major Deegan Expressway. The defendants allegedly put the infant’s body in bags and left her at that location.

 According to the investigation, a Child Protective Specialist, employed by the New York City Administration of Children's Services, called the defendants on May 28, 2023. During the conversation, both defendants allegedly stated at separate times that the defendants and their daughter were all alive, safe and had relocated to Louisiana, which was not the case. The parents were arrested on May 29, 2023 when the infant’s grandfather called police after defendant Comager admitted to him that he had killed the infant. Comager led detectives to the location where the infant’s body was left.

 District Attorney Clark thanked NYPD Detective Ryan Brady of the 44th Precinct and NYPD Detective Patrick Curran of Bronx Homicide for their work in the investigation.

An indictment is an accusatory instrument and not proof of a defendant’s guilt.

Third Avenue Business Improvement District - Now Hiring: Executive Director

 

Full Job Description - Click Here

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Following Historic Flooding, Governor Hochul Celebrates Full Reopening of Metro-North Railroad and Announces Amtrak Service Will Resume Between New York City and Albany

 

Metro-North Crews Restored Service on the Upper Hudson Line and Upper Harlem Line Less Than Two Days After Hudson Valley Hit with Severe Storms

Amtrak Service Between Penn Station and Albany-Rensselaer Resumed Today

 Governor Kathy Hochul today celebrated the full reopening of the Metro-North Railroad and announced Amtrak service will resume between New York City and Albany after the historic rainfall and flooding that hit the region on July 9. Governor Hochul, Metropolitan Transportation Authority Chair and CEO Janno Lieber and Metro-North Railroad President Catherine Rinaldi made the announcement after welcoming some of the first Metro-North commuters to arrive at Grand Central Terminal after service was restored on the Hudson Line.

“Experts said it could take more than a week to restore full Metro-North service, but thanks to the hard work and talent of MTA union workers we have restored service to every Metro-North station,” Governor Hochul said. “Because of the climate crisis, these weather emergencies are quickly becoming our new normal – and I’m committed to doing everything in my power to strengthen our infrastructure so it’s resilient for generations to come.”

In the immediate aftermath of the storm, Metro-North service was suspended north of Croton-Harmon on the Hudson Line and north of Southeast station on the Harlem Line. Less than two days after the storm hit, Metro-North was able to return service to the Hudson Line, beginning with Poughkeepsie-bound trains operating on Tuesday evening. Service was also restored on the Upper Harlem Line Wednesday morning.

MTA Chair and CEO Janno Lieber said, “We’ve been weathering big storms together – Hurricane Ida rocked the Hudson Valley in 2021, hitting the Metro North operations especially hard, and now here we are in the aftermath of another once-in-a-generation storm. The MTA team stepped up once again to get the railroad back on track. I have to thank the hundreds of crew members who worked around the clock to make this happen.”

Service was suspended on the Hudson Line north of Croton-Harmon on Sunday afternoon and on the Harlem Line north of Southeast on Monday morning, due to severe storm damage. The suspensions of service on the Hudson and Harlem lines were impacting nearly 14,000 riders per day, and nearly 105,000 riders rely on these lines every week.

The removal of fallen trees, water, mud and boulders engaged hundreds of MTA workers and contractors, with more team members tracking outages, moving equipment and managing substitute bus service. These teams included members of the International Brotherhood of Electrical Workers, the International Brotherhood of Teamsters, the Association of Commuter Rail Employees, and the Railway and Airway Supervisor Association. Crews will continue clean up along the Hudson Line as the railroad works to restore full regularly scheduled service on the line.