Four men have been arrested in relation to running a cryptocurrency scam called BitClub Network that is alleged to have defrauded investors of $722 million.

The men arrested — 37-year-old Matthew Brent Goettsche from Lafayette, Colorado, and 38-year-old Jobadiah Sinclair Weeks from Arvada, Colorado, were charged with conspiracy to commit wire fraud. A third man, 49-year-old Joseph Frank Abel of Camarillo, California, along with the first two were also charged with conspiracy to offer and sell unregistered securities. The fourth man, Silviu Catalin Balaci, was arrested in Germany on similar charges.

The BitClub Network, established in 2014 and still online now, claims to be “the most innovative and lucrative way to earn bitcoin.” At its core, the alleged scam pitched itself as a bitcoin mining investment opportunity, but the U.S. Department of Justice begs to differ.

According to the indictment issued Tuesday, BitClub Network was a Ponzi scheme wherein money invested by new members was used to pay out to older members while those behind it stole millions of dollars in the process.

Usually, those behind theses sorts of schemes tend to be careful about how they operate them to avoid raising suspicion or creating electronic records that can be used in a court hearing. But in the case of BitClub Network, it was more a case of dumb and dumber. Along with calling investors dumb and sheep, the accused allegedly discussed the fact that they were operating a Ponzi scheme, actually using the term Ponzi in correspondence.

Where the additional securities charges come into the picture is that, not content with scamming customers in their Ponzi scheme alone, the accused then went on to attempt to sell shares in BitClub Network without registering the offering with the U.S. Securities and Exchange Commission.

The wire fraud charges and the securities violation mean the accused face up to 25 years in prison with $250,000 in fines on each charge. Anyone who has been a victim of BitClub Network is encouraged to contact the Justice Department.

Image: BitClub Network