Misam M. Abidi, 47, of Nolensville, Tennessee, was indicted on 11 federal counts for allegedly running a cryptocurrency Ponzi scheme through his firm Star Credit Holdings from 2020 to 2024, the Justice Department announced Friday. Prosecutors allege Abidi lured investors with false promises of guaranteed high returns and a substantial reserve fund, then used new investor money to pay earlier investors while diverting over $1.9 million to himself and family members. The indictment reflects ongoing federal enforcement against cryptocurrency fraud schemes that harm individual investors and financial institutions.
Abidi Allegedly Operated Classic Ponzi Structure With False Investment Claims
Prosecutors allege Abidi used a web of false promises to lure in investors. Among the misrepresentations he allegedly made were guarantees of high rates of return, claims that he maintained a substantial reserve fund to protect investors, and assertions that he managed far more capital than he actually controlled. Rather than generating returns through legitimate trading, Abidi allegedly paid earlier investors using money contributed by newer ones—a hallmark of the classic Ponzi scheme structure. He also allegedly helped investors secure personal loans in their own names to funnel additional funds into the firm, and falsified at least one affidavit claiming an investor's identity had been stolen in order to obtain such a loan.
Prosecutors Say Abidi Diverted $1.9 Million and Filed False Tax Returns
Prosecutors say Abidi diverted more than $1.9 million of investor funds to himself and family members. He also failed to report income from the operation on his federal tax returns. U.S. Attorney D. Michael Dunavant stated, "Ponzi schemes, cryptocurrency scams, and financial fraud can be devastating to individual investors, harmful to financial institutions, and detrimental to the U.S. Treasury. We commend our federal agency partners for their outstanding investigation in this egregious case. Wherever fraud occurs in the Western District of Tennessee, this office will be prepared to hold offenders accountable."
Indictment Includes Wire Fraud and Money Laundering Charges
The indictment includes charges of wire fraud, operating an unlicensed money transmitting business, aiding in the preparation of false tax returns, and money laundering. If convicted on all counts, Abidi could face decades in federal prison.
FAQ
What did Misam M. Abidi allegedly do through Star Credit Holdings?
Prosecutors allege Abidi ran a cryptocurrency Ponzi scheme from 2020 to 2024, using new investor funds to pay earlier investors while making false promises of guaranteed returns and a substantial reserve fund.
How much money did Abidi allegedly divert to himself and family?
Prosecutors say Abidi diverted more than $1.9 million of investor funds to himself and family members, and failed to report this income on his federal tax returns.
What charges does Abidi face in the federal indictment?
The 11-count indictment includes charges of wire fraud, operating an unlicensed money transmitting business, aiding in the preparation of false tax returns, and money laundering. If convicted on all counts, he could face decades in federal prison.
