Tennessee resident hit with 11-count federal indictment over alleged $1.9M crypto Ponzi scheme
Federal prosecutors have charged a Tennessee man with running an alleged cryptocurrency investment operation that siphoned off more than $1.9 million in investor funds. The U.S. Department of Justice says Misam M. Abidi, 47, of Nolensville, is the target of an 11-count indictment covering conduct from 2020 through 2024 tied to a firm called Star Credit Holdings.
According to the indictment announced Friday, Abidi allegedly marketed Star Credit Holdings with promises of high returns and misrepresented the company’s reserves and assets under management — claiming it controlled far more capital than it actually did. Prosecutors say investors from multiple states entrusted money to the operation, but that funds were diverted away from legitimate trading.
Court filings accuse Abidi of operating a Ponzi-style structure: using funds from newer investors to pay earlier participants while redirecting significant sums to personal expenses and to family members. Prosecutors assert that more than $1.9 million flowed to Abidi and members of his family.
The indictment also alleges Abidi encouraged investors to take out personal loans to inject additional capital into Star Credit Holdings, and that he submitted false information in connection with at least one loan application — including a fraudulent affidavit claiming an investor’s identity had been stolen. Federal tax-related allegations are included as well: prosecutors contend Abidi failed to report income from the operation, resulting in false tax returns.
Charges listed in the indictment include wire fraud, money laundering, operating an unlicensed money-transmitting business, and counts related to false tax return preparation. The charges are allegations; they must be proven in court. No trial date has been announced. If convicted on all counts, Abidi could face decades behind bars.
U.S. Attorney D. Michael Dunavant emphasized the broader harm such schemes can cause. “Ponzi schemes, cryptocurrency scams, and financial fraud can be devastating to individual investors,” he said, adding that the conduct also damages financial institutions and the U.S. Treasury and praising the federal agencies that investigated the case.
The indictment arrives amid heightened scrutiny of crypto-related crime in Washington. As previously reported by crypto.news, bipartisan lawmakers recently proposed the Federal Cryptocurrency Theft Enforcement and Coordination Act, which would establish a task force led by the attorney general and involving the DOJ, FBI, Homeland Security, and Treasury to better coordinate enforcement against crypto theft and fraud.
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