CONCORD, N.H. (AP) — A federal judge on Monday sentenced a New Hampshire man to eight years in prison for running an unlicensed bitcoin exchange business and fined him at least $40,000, although a hearing will be held to determine how much money multiple people who said they were victimized by his enterprise will get.
Ian Freeman was taken away in handcuffs following his sentencing in U.S. District Court in Concord. Prosecutors said Freeman, a libertarian activist and radio show host, created a business that catered to fraudsters who targeted elderly women with romance scams, serving as “the final step in permanently separating the victims from their money.”
“Love you, Ian,” supporters shouted as he was led out of court.
Freeman, who is in his 40s, said in court he did not believe he broke the law. He said he was trying to get people to adopt bitcoin. He said there were times he detected fraud and protected many potential scam victims. He apologized for not being able to help them all.
“I don’t want people to be taken advantage of,” said Freeman, who said he cooperated with law enforcement to help some people get their money back.
Freeman said he devised a series of questions for customers, including whether a third party was putting them up to their transactions or if they were under duress. Some victims lied about their circumstances, he said. Freeman also said he didn’t learn about scam victims until he saw their stories in the news.
“It didn’t matter how strict I was or how many questions I asked,” he said.
After a two-week trial, he was convicted of eight charges in December, although his conviction on a money laundering charge was later overturned by the judge. The prosecution is appealing it to the 1st Circuit Court of Appeals.
Freeman was sentenced on the remaining charges, which include operating an unlicensed money transmitting business and conspiracy to commit money laundering and wire fraud. Freeman’s lawyers said they planned to appeal and asked that he remain free on bail for now, but U.S. District Court Judge Joseph LaPlante didn’t allow it.
“There was real harm caused by his conduct,” LaPlante said.
The sentencing guidelines called for much longer term, ranging from about 17 years to nearly 22 years in prison. Freeman, who doesn’t have a prior criminal record and has been monitored by the government for at least the last two years in Keene, where he lives, had asked for a sentence of a little over three years in prison.
His wife, Bonnie Freeman, said he was a positive role model and leader at a local church. Sheriff David Hathaway of Santa Cruz County, Arizona, described Freeman as an “advocate for freedom and the American dream” and “promoting free trade capitalism and individual liberty.”
The transactions were handled at bitcoin kiosks in bars, online and through an app.
Last month, one of the victims described herself as a lonely widow who got scammed by a man she met on a dating site. At his instruction, she sent $300,000 to Freeman, wiping out her life’s savings. Another woman told a similar story of taking out three loans and selling her late husband’s truck to send money to the man who duped her.
Five other people were arrested with Freeman in 2021. Three pleaded guilty to wire fraud for opening accounts at financial institutions in their names or in the names of churches to allow someone to use the accounts to sell virtual currency. They received light sentences. A fourth pleaded guilty to operating an unlicensed money transmitting business and was sentenced to 18 months in prison. Charges were dismissed against the fifth person.