85-Year-Old Former Lawyer on Hospice Care Admits to $9.5 Million Crypto Scam
An 85-year-old former attorney from Beverly Hills, David Kagel, who is currently under hospice care, pleaded guilty on Wednesday to participating in an elaborate cryptocurrency Ponzi scheme that lasted for several years.
Kagel, along with two other co-conspirators, promoted fake crypto investment programs, promising investors high returns through the use of AI trading bots. The scheme’s promoter alleged that Kagel held more than $11 million in escrow to ensure investors’ funds were protected, even creating fraudulent documents to support these claims.
“Kagel took advantage of trusting individuals through a complex scheme designed to separate them from their hard-earned money,” said Tyler Hatcher, the Special Agent in Charge of the IRS Criminal Investigation’s Los Angeles Field Office.
In total, Kagel and his co-conspirators defrauded investors of approximately $9.5 million, using the funds for their personal gain.
“David Kagel abused his position as an attorney to gain the trust of investors and endorse false statements about a cryptocurrency investment that turned out to be a scam,” stated Nicole M. Argentieri, the Principal Deputy Assistant Attorney General of the Justice Department’s Criminal Division. “They defrauded their victims out of millions of dollars and used the money to enrich themselves.”
Kagel’s co-conspirators, Vincent Anthony Mazotta Jr. from Los Angeles and David Gilbert Saffron from Australia, are scheduled to stand trial in August for their alleged involvement in the digital asset fraud. They are accused of misappropriating victims’ funds for personal expenses, such as private jet flights, luxury hotel accommodations, mansion rentals, a personal chef, and private security guards.
Kagel has faced multiple disciplinary charges as an attorney throughout the years, leading to the revocation of his license in 2022 due to allegations of misappropriating customer funds.
The disgraced former attorney, who disclosed in court documents last October that he was receiving hospice care in a Las Vegas facility, pleaded guilty to one count of conspiracy to commit commodity fraud. He could face a maximum sentence of five years in prison and is scheduled to be sentenced on September 10.
