Blue Bit Banc and Blue Bit Analytics Scammer Sentenced to 86 Months in Prison for Defrauding Investors

Blake Kantor, who formerly operated a binary options company known as Blue Bit Banc and Blue Bit Analytics (“BBB”), was sentenced on Monday, in federal court. The sentence of 86 months’ imprisonment was given for operating a scheme to defraud BBB investors who also invested in a cryptocurrency known as “ATM Coin”.

Blake Kantor, also known as Bill Gordon, pleaded guilty to orchestrating a scam to defraud investors out of $2 million in a binary options scheme.

As part of the deal, the defendent will be followed by three years’ supervised release.  In addition to the 86-month prison sentence, Kantour was also ordered to pay restitution of $806,405 to the victims of his crime, forfeiture of $1.5 million, and forfeiture of approximately $153,000 of stolen proceeds.  In November 2018, Kantor pleaded guilty to conspiracy to commit wire fraud, and as part of his plea agreement, he admitted to obstructing the government’s investigation.

“Kantor has been held accountable for defrauding investors through his lies and deceit,” stated United States Attorney Donoghue.  “This Office and our law enforcement partners will continue to vigorously prosecute those who perpetrate financial frauds and obstruct investigations of their crimes.”

In March 2014, Kantor established BBB, and solicited and received approximately $1.5 million from more than 700 investors in BBB’s binary options for the period between 2014 and 2017.  He convinced investors to buy the primary ATM Coin with their BBB investments under the promise that they would be able to place binary option trades, or a BBB representative could do so for them. Under the agreement, the predetermined profits promised to investors would be based on the actual prices of securities, currencies and other investments at particular points in time. 

However, after an investigation into the company’s practices, it became apparent that a BBB computer software program fraudulently altered data associated with binary options investments. This way, the probability of investors earning a profit favored BBB and disadvantaged investors.  Kantor also fraudulently persuaded several BBB investors’ to convert their BBB investments into “ATM Coin,” a worthless cryptocurrency that he told investors was worth as much as $600,000.

The last know price of the said ATMCoin (ATMC) is $2.26 and attempting to access the site results in the following warning message on Chrome:

“Your connection is not private. Attackers might be trying to steal your information from (for example, passwords, messages, or credit cards). Learn more.”

In October 2017, after FBI agents informed Kantor that they were investigating his involvement in binary options, Kantor directed a co-conspirator to alter BBB customer lists. Although the CEO of BBB was prohibited from destroying the company’s records, he lied to the FBI and altered the documents that would reveal their scheme. The government’s case is being handled by the Office’s Long Island Criminal Division.  It is the first The arrest is the first milestone of an imminent crackdown by the US federal regulators on binary options brokers and the adjacent service providers.