Ex-NFL club owner Reggie Fowler receives a six-year sentence for cryptocurrency “shadow banking”

The former co-owner of the Minnesota Vikings lied, according to United States Attorney Damian Williams, putting the American financial system at “serious risk.”

Former NFL team owner Reginald Fowler received a six-year prison term for acting as a “shadow bank” for the cryptocurrency industry in 2018, which involved over $700 million in unregulated transactions over a period of ten months.

The United States Attorney’s Office in New York said on June 5 that the 63-year-old, who was a co-owner of the Minnesota Vikings, had been given a cumulative sentence of 75 months for bank fraud and money laundering.

It marks the conclusion of a five-year case that started when he was detained in 2019 on suspicion of engaging in shadow banking. The phrase “shadow banking” refers to (sometimes illegal) activities similar to those of banks that are carried out by organisations other than banks.

In April 2022, Fowler, who had first pleaded not guilty to all charges in 2020, amended his plea to guilty.

U.S. Attorney Damian Williams claimed in his most recent statement that Fowler was able to cheat and mislead many banks thanks to a series of lies:

“Reginald Fowler violated federal law by acting as a shadow bank to execute hundreds of millions of dollars in unregulated transactions for bitcoin exchanges. In order to accomplish this, he deceived reputable U.S. financial institutions, placing the entire financial system at considerable danger.

In order to obtain a “substantial” share in the Alliance of American Football (AAF), Williams said Fowler “victimized” the league by lying about his net worth. The AAF was a defunct professional football league.

The federal prosecutor emphasized, “Let it be clear: this Office is committed to prosecuting persons who lie to banks and break the law in order to run their business.

Williams claims that Fowler was able to get away with his crimes thanks to the creation of Global Trading Solutions (GTS), which collaborated with Crypto Capital and other Israeli-based cryptocurrency companies, around February 2018.

In order to open accounts that were used to handle cryptocurrency transactions, Fowler, GTS, and the crypto companies there deceived banks in order to avoid having to obtain a license.

Williams said that Fowler neglected to reveal GTS’s relationship with the crypto firms when he opened a dozen of these accounts to conduct these crypto transactions without the knowledge of the banks.

“At no time, as required by federal law, were FOWLER, GTS, or any of the Crypto Companies ever licenced as a money transmitting firm in the United States.

It stated that iFinex Inc., the parent company of the cryptocurrency exchange Bitfinex and the stablecoin issuer Tether, was one of the involved crypto companies.

Conspiracy to commit wire fraud, operating an unlicensed money transmitter business, operating an unlicensed money transmitter business, and operating an unlicensed money transmitter business all resulted in convictions as well.

Along with the prison term, Fowler was also required to forfeit $740 million and make restitution of more than $53 million to the AAF.