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86-Year-Old California Lawyer Sentenced to Five Years Probation, Ordered to Pay Nearly $14 Million
In an Oct. 8 ruling in federal court in Las Vegas, Judge Gloria Navarro sentenced David Kagel after he pleaded guilty to one count of conspiracy to commit commodity fraud in May.
Kagel is currently in hospice care at a Las Vegas assisted living facility due to poor health, where he will serve probation unless he leaves and where he will be required to wear a monitoring device.
State prosecutors who charged Kagel last year said that from December 2017 to June 2022, Kagel and two co-conspirators lured victims into investing in a fraudulent cryptocurrency bot trading scheme with promises of high returns and no risk.
During that time, the trio “fraudulently marketed and solicited investments and received at least approximately $15 million in victim-investor funds for various cryptocurrency trading programs,” prosecutors said.
Kagel facilitated the cryptocurrency scam by writing letters on his law firm’s letterhead that were then sent to victims.
The official letterhead helped build trust, prosecutors said,
giving victims the impression they were investing in a legitimate scheme that used trading bots to invest in cryptocurrency markets.
Related: IcomTech Cryptocurrency Ponzi Scheme Founder Sentenced to 10 Years in Prison
The scheme “guaranteed” a return of the investment’s principal and a profit of between 20% and 100% of the investment’s principal within 30 days.
Kagel claimed to have 1,000 Bitcoin (BTC) in a wallet worth $11 million in January 2018, which was held in escrow to guarantee the investment. He also falsely stated that he had previously invested in cryptocurrency to increase the broker’s credibility.
In 2023, the California Supreme Court revoked Kagel’s law license for failing to respond to disciplinary charges, alleging he misappropriated $25,000 in client funds.
His law license had previously been suspended twice, in 1997 and 2012.
Both of Kagel’s alleged accomplices, David Saffron and Vincent Mazzotta, have pleaded not guilty and are awaiting trial in Los Angeles federal court next April.
In an Oct. 8 ruling in federal court in Las Vegas, Judge Gloria Navarro sentenced David Kagel after he pleaded guilty to one count of conspiracy to commit commodity fraud in May.
Kagel is currently in hospice care at a Las Vegas assisted living facility due to poor health, where he will serve probation unless he leaves and where he will be required to wear a monitoring device.
State prosecutors who charged Kagel last year said that from December 2017 to June 2022, Kagel and two co-conspirators lured victims into investing in a fraudulent cryptocurrency bot trading scheme with promises of high returns and no risk.
During that time, the trio “fraudulently marketed and solicited investments and received at least approximately $15 million in victim-investor funds for various cryptocurrency trading programs,” prosecutors said.
Kagel facilitated the cryptocurrency scam by writing letters on his law firm’s letterhead that were then sent to victims.
The official letterhead helped build trust, prosecutors said,
giving victims the impression they were investing in a legitimate scheme that used trading bots to invest in cryptocurrency markets.
Related: IcomTech Cryptocurrency Ponzi Scheme Founder Sentenced to 10 Years in Prison
The scheme “guaranteed” a return of the investment’s principal and a profit of between 20% and 100% of the investment’s principal within 30 days.
Kagel claimed to have 1,000 Bitcoin (BTC) in a wallet worth $11 million in January 2018, which was held in escrow to guarantee the investment. He also falsely stated that he had previously invested in cryptocurrency to increase the broker’s credibility.
In 2023, the California Supreme Court revoked Kagel’s law license for failing to respond to disciplinary charges, alleging he misappropriated $25,000 in client funds.
His law license had previously been suspended twice, in 1997 and 2012.
Both of Kagel’s alleged accomplices, David Saffron and Vincent Mazzotta, have pleaded not guilty and are awaiting trial in Los Angeles federal court next April.