Cryptocurrency Whistleblower

Max (Maksim) Dilendorf, Esq.

212.457.9797 | md@dilendorf.com

Our law firm was among the first in the U.S. to delve into the world of cryptocurrency back in 2017.

Over the past seven years, we have built a distinct digital asset law practice, dedicating tens of thousands of hours to managing diverse client cases, conducting thorough research, and engaging with industry regulators.

With a deep understanding of the industry, we stand at the forefront of crypto law. Our dedicated team champions whistleblowers who prioritize the long-term growth of the crypto industry.

We focus on exposing investment fraud, crypto rug pulls, and illegal activities that breach anti-money laundering regulations under the U.S. Bank Secrecy Act, as well as federal and state money transmitter and securities regulations.

Countless innocent consumers in the U.S. fall prey to deceptive cryptocurrency projects that falsely promise compliance, consumer protection, transparency, and state-of-the-art cybersecurity. These promises often turn out to be blatant lies.

If you are committed to the sustainable development of the cryptocurrency industry and wish to report illegal activities to eliminate bad actors, we are here to support you.

ATTORNEYS' EXPERIENCE

A company and its subsidiary paid $66 million to resolve claims that the fiber they used to produce their supposedly bullet-proof vests for law enforcement agencies was so weak and defective that it could not stop a bullet 50% of the time.

ATTORNEYS' EXPERIENCE

One of the largest, most-respected accounting firms paid $149 million for failing to properly audit a participant in an important government mortgage program.

ATTORNEYS' EXPERIENCE

One of the largest banks in America – along with two financial institution subsidiaries – agreed to pay $16.65 billion to resolve charges that it engaged in fraudulent practices in the issuance and marketing of collateralized debt obligations involving home mortgages.

Real Estate Real Estate Fund Formation Commercial Leasing Real Estate Tokenization Commercial Acquisitions Foreign Investment Residential Transactions 1031-Exchange Transactions Foreclosures Real Estate Wire Fraud

VC & Corporate Hedge Fund Lawyers Venture Capital Funds Money Transmitter License Solutions from US to Africa General Counsel Services Tokenized Funds Fund Formation Venture Capital Transactions Private Placements

Estate Planning Dynasty Trusts Domestic Self-Settled Trusts Domestic Asset Protection Trusts Crypto Asset Protection Asset Protection for NY Residents

Blockchain & Crypto Money Transmitter Licensing Crypto Fraud STO Launch ATS Platforms Tokenized Funds NFT Launch Recovery of Stolen Digital Assets Recovery of Stolen Crypto from Coinbase Crypto Asset Protection Recovery of Stolen Crypto From Gemini Art Tokenization RWA Launch

Blockchain Litigation Crypto Whistleblowers Recovery of Stolen Crypto From Gemini Recovery of Stolen Crypto from Coinbase SIM Swap Crypto Hacks Enforcement Action Defense

Tax Planning Estate & Gift Tax Planning Tax Structuring and Due Diligence Tax Levies & Liens IRS Offers in Compromise Tax Appeal and Tax Settlements Tax Planning for Business and Startups Pre-Immigration Tax Planning Foreign Investments in U.S.International Tax Planning

Litigation Whistleblower Actions SIM Swap Crypto Hacks Crypto Fraud Securities Fraud EFTA Attorney

Is Defi Legal in the US?

In 2022, our firm published an insightful article exploring the legality of DeFi under the current U.S. regulatory framework. You can read the full post here.

To summarize, our analysis indicates that most DeFi operations in the U.S. are likely to conflict with the rules, regulations, and guidance issued by the U.S. Department of Treasury, the Department of Justice, the Financial Crimes Enforcement Network, and the Office of Foreign Assets Control.

These conflicts primarily arise due to potential violations of the U.S. Bank Secrecy Act and Anti-Money Laundering regulations.

These are just a few of the federal agencies with jurisdiction over cryptocurrency transactions. The unchecked and stolen crypto due to vulnerabilities in DeFi smart contracts, inadequate cybersecurity protocols, crypto rug pulls and unethical founders not only undermine the ecosystem’s development but also pose significant national security risks.

By understanding and addressing these regulatory challenges, we can work together to create a more secure and sustainable future for the cryptocurrency industry.

Incentives for Cleaning Up the Industry

There are significant incentives for taking action.

Under Dodd-Frank, the Securities and Exchange Commission (SEC) and the Commodities Futures Trading Commission (CFTC) can offer monetary awards of 10% to 30% of the money collected to individuals who provide high-quality information leading to enforcement actions with sanctions over $1 million.

Additionally, the Anti-Money Laundering Act of 2020 has empowered the Department of Treasury’s Financial Crimes Enforcement Network (FinCEN) to establish a new whistleblower program.

This program removes the previous $150,000 cap on awards and authorizes the Treasury to grant up to 30% of the money collected from enforcement actions to whistleblowers.

These substantial financial rewards not only incentivize individuals to expose wrongdoing but also play a crucial role in cleaning up the cryptocurrency industry, ensuring its long-term health and integrity.

Our Firm’s Strong Relationships with Federal Crypto Regulators

At Dilendorf Law Firm, we pride ourselves on our robust relationships with the federal agencies regulating the cryptocurrency industry.

Our attorneys are deeply familiar with the federal whistleblower programs. Leveraging this experience, we collaborate closely with our clients, ensuring they feel safe and protected throughout the entire process.

By collaborating with regulatory bodies and utilizing our in-depth knowledge, we effectively navigate the complexities of the crypto field and advocate for our clients’ best interests.

Key Federal Agencies Overseeing Illicit Crypto Activities in the U.S.

U.S. Secret Service: Combats the illicit use of digital assets.
U.S. Department of Justice: Houses a dedicated crypto enforcement unit.
U.S. Department of Homeland Security: Addresses illicit activities utilizing cryptocurrencies.
Securities and Exchange Commission (SEC): Regulates securities-related crypto activities.
Commodities Futures Trading Commission (CFTC): Oversees commodity-related crypto activities.

Depending on the misconduct you wish to report, we advocate for your rights and those of consumers with the appropriate enforcement agency.

Our firm is equipped to provide the best possible representation for whistleblowers in the crypto, blockchain, and fintech industries, including but not limited to:

Decentralized Exchanges (DEXs)
Centralized Cryptocurrency Exchanges
Digital Asset Exchanges
Decentralized Finance (DeFi) Platforms
Online Trading Platforms
Decentralized Applications (dApps)
Liquidity Pool Providers
Token and NFT Issuers
Wallet Providers

At Dilendorf Law Firm, we ensure all claims are filed correctly and with the appropriate parties, while safeguarding our clients’ privacy. Our experienced team has an excellent track record of working with various government agencies, ensuring our clients are protected from employer retaliation.

Track Record of our Excellent Strategic Co-Counsels – Adam Pollock and Steve Cohen

Research Fraud

A major university paid $112.5 million to settle allegations that it falsified research data in grant applications.

A major pharmaceutical company paid $3 billion to resolve charges that it illegally promoted nine different prescription drugs, paid kickbacks to doctors to prescribe the medications, and falsified scientific research and articles.

Contracting Fraud

A company and its subsidiary paid $66 million to resolve claims that the fiber they used to produce their supposedly bullet-proof vests for law enforcement agencies was so weak and defective that it could not stop a bullet 50% of the time.

A company responsible for servicing American Navy ships in foreign ports inflated its invoices, resulting in a $20 million fine.

An aluminum manufacturer paid $34.6 million to resolve claims that it falsified critical testing data about the consistency and reliability of its products, resulting in two failed rocket launches by NASA.

A Kuwaiti company paid $95 million to resolve claims that it overcharged the Department of Defense for the fruits and vegetables it provided to American troops stationed in Iraq.

A major engineering and construction company agreed to pay $125 million to resolve allegations that it provided deficient materials, services, and testing involving nuclear waste.

Oversight Fraud

One of the largest, most-respected accounting firms paid $149 million for failing to properly audit a participant in an important government mortgage program.

A home mortgage company was found liable by a jury for $92 million in damages for issuing improperly issuing mortgages to unqualified applicants who then quickly defaulted on the loans.

One of the largest banks in America – along with two financial institution subsidiaries – agreed to pay $16.65 billion to resolve charges that it engaged in fraudulent practices in the issuance and marketing of collateralized debt obligations involving home mortgages.

Another major bank paid $641 million to settle allegations that it issued FHA and Veterans Affairs insured home loans to people who then defaulted; and the government paid the bank insurance money on mortgages that should never have been approved.

Healthcare Fraud

A healthcare provider paid $195 million to settle allegations that the company encouraged physicians to prescribe highly addictive opioid painkillers for unapproved purposes. (The painkillers were approved for cancer patients only, but the company was encouraging prescriptions for non-cancer patients.)
A company paid $500 million to resolve various claims including that it promoted the use of its drug product to physicians who “were writing prescriptions … that were unsafe, ineffective, and medically unnecessary.”
A healthcare operator paid $48 million to resolve allegations that some patient admissions to its facilities were not medically necessary and that some of its facilities provided inaccurate information to Medicare to maintain their status as “inpatient rehabilitation facilities” – a designation that enabled the operator to earn a higher rate of reimbursement from Medicare.

A major pharma company paid $625 million to resolve allegations that it improperly repackaged potentially contaminated oncology-supportive injectable drugs.

A medical device manufacturer paid $33.2 million to resolve allegations that it sold a materially unreliable testing device that was intended to help doctors and nurses diagnose drug overdoses, assess acute coronary syndrome, and identify other serious conditions

Two of America’s most respected pharmaceutical companies paid more than $233 million to resolve various claims that they set up bogus schemes – including funneling money through a non-profit foundation to pay patients’ co-pays – to improperly inflate the price of drugs paid by Medicare in some cases by as much as 40%.

A major provider of electronic medical records paid $155 million to resolve charges that it misrepresented what its software could do, and then paying kickbacks to customers to promote the product.

A major hospital system paid $731 million to resolve claims that it ordered medical tests that were not necessary, up-coded various charges, and misrepresented its advertising expenses as “community education” in order to get the government to pay for non-reimbursable expenses.

A major drug company paid $2.2 billion to resolve charges that it illegally marketed off-label uses of three drugs.

A major nursing home chain paid $145 million to resolve a complaint that it provided unnecessary rehab services.

The most common types of healthcare fraud include:

billing for services that were never rendered;

upcoding;

performing medically unnecessary services;

misrepresenting treatments not covered by insurance as covered treatments;

falsifying patients’ diagnoses and medical records to justify tests, surgeries or other procedures that aren’t medically necessary; and

“unbundling” or billing for each step of a procedure as if they are separate procedures.

Recent SEC Public Whistleblower Awards:

Recent CFTC Public Whistleblower Awards:

Resources:

For more information about our services,

please contact Dilendorf Law Firm by sending an email or calling us at 212.457.9797