Jury Finds Man Guilty in $24M AI Crypto Ponzi Scheme

Jury Convicts Las Vegas Businessman in $24 Million Cryptocurrency Ponzi Scheme

A federal jury in Las Vegas has found a local business owner guilty of orchestrating a $24 million cryptocurrency Ponzi scheme that defrauded at least 400 investors, the Department of Justice announced Monday.

Brent C. Kovar, the owner of Profit Connect, a Las Vegas-based company, operated the scheme from late 2017 until July 2021. He falsely claimed the company utilized artificial intelligence software on a supercomputer to mine cryptocurrency and verify transactions on other networks. Investors were enticed with promises of fixed annual returns ranging from 15% to 30%, a full money-back guarantee, and assurances that the company was backed by hundreds of millions of dollars in crypto reserves.

Prosecutors presented evidence that Kovar was aware Profit Connect was not profitable, possessed no actual reserves, and was incapable of delivering the advertised returns or honoring its guarantees. Funds from new investors were allegedly used to sustain company operations, purchase employee gifts, and acquire a house for Kovar. A portion of this money was also recirculated to earlier investors, misrepresented as mining profits.

Adding to the deception, Kovar reportedly informed investors that their funds were insured by the Federal Deposit Insurance Corporation (FDIC). This claim was investigated by the FDIC’s Office of Inspector General, in conjunction with the FBI and IRS Criminal Investigation.

Following a nine-day trial, Kovar was convicted on 11 counts of wire fraud, two counts of mail fraud, and two counts of money laundering. He is scheduled for sentencing on November 30 and faces a potential maximum sentence of 280 years, though the final term will be determined by the judge based on federal sentencing guidelines.

The Securities and Exchange Commission (SEC) had previously intervened, shutting down Profit Connect five years ago. In July 2021, the SEC obtained a restraining order and asset freeze, initially estimating investor losses at up to $12 million from at least 277 investors. This figure is now understood to be half of the total losses established by prosecutors. The SEC noted that over 90% of the company’s income originated from investors, and none of these funds were used for actual cryptocurrency trading.

Kovar reportedly ran the business with his mother, Joy, who was 86 at the time. The SEC indicated that $1.2 million was transferred into her personal account in ten equal installments over less than two months, with an additional $1.7 million withdrawn through cash, credit card payments, and the purchase of a vehicle. The Justice Department’s announcement on Monday specifically named Brent Kovar in relation to the criminal convictions.

This is not Kovar’s first encounter with regulatory action. The SEC had previously filed a civil injunction against him and his father, Glenn, in 2009 for their involvement in a “pump-and-dump” scheme operated through a company called Skyway Global, which also resulted in $12 million in investor losses.

Investment fraud continues to be the most significant category of cryptocurrency-related crime reported to the FBI. In 2025, the bureau logged $11.37 billion in losses, a 22% increase from the previous year. The Consumer Federation of America, using a multiplier to account for unreported fraud, estimated total losses to be $80.7 billion, with individuals over 60 accounting for $4.4 billion of the reported figures.