Two Charged With Duping Investors Out of $5M With Bogus Bitcoin-Buying Brokerage

New York federal prosecutors charged two men with running a phony bitcoin brokerage service that duped victims of $5 million.

As alleged in a criminal complaint unsealed Monday, former fugitive Randy Craig Levine and disbarred attorney Philip Reichenthal never bought their two high-rolling investors any bitcoin despite promising to do so.

One victim, an unnamed "Purported cryptocurrency escrow firm," wired Levine $3 million to fund an over-the-counter desk's bitcoin buy, according to prosecutors, who said the second victim, a Florida bitcoin investor, wired Levine $2 million.

Levine allegedly told the victims their funds were moved into an "Escrow" service and then stopped responding to the victims' questions.

Levine's escrow was actually Reichenthal's money-laundering front, prosecutors allege.

They claim Reichenthal wired millions to Russian, Mexican and Guatemalan bank accounts controlled by Levine aliases.

Levine and Reichenthal allegedly pocketed the money, giving their victims no refunds or bitcoin.

The pair face allegations of wire fraud, money laundering and commodities fraud in New York federal district court.

Levine is currently awaiting extradition from Austria; he's been on the run from U.S. authorities since 2005.

Reichenthal was disbarred last October in a Florida court.