Former Republican State Senator to be arrested for crypto scam

Texas federal judge, Pete Robert Pitman, issued arrest warrant against former senator and the leaders of an alleged cryptocurrency scam with Meta 1 coin. At the hearing on 21 April, the judge ordered the arrest of former GOP senator David Schmidt and cohort Robert Dunlap after they failed to appear in court. The proceedings were conducted over video conference in line with the Covid-19 preventive measures.

The third defendant, Nicole Bowdler, was not issued an arrest warrant but he is given a final opportunity to comply by 24 April.

In the ongoing Meta 1 coin crypto scam case, the SEC alleges that Schmidt assured investors the coins were backed with “$1 billion in fine art or $2 billion of gold holdings” without having any actual tokens. On March 16, the SEC froze the cryptocurrency’s assets and charged toe operators with fraud.

scam company

However, the charges did not stop Schmidt and Dunlap from continuing to promote Meta 1. SEC’s contempt motion states that the three defendants had raised more than $4.3 million from “investors” and were continuing to sell the tokens.

Judge Pitman said that in this case imposing a fine would not be effective and chose a arrest warrant, instead.

Judge Pitman stated:

If incarcerated, Dunlap and Schmidt will be unable to continue Meta 1’s operations, create marketing videos, or email their putative investors.

When Schmidt lost his re-election campaign in 2006, he was investigated for misspending over $40,000 in campaign funds and subsequently paid a $10,000 fine. However, he does not seem like the mastermind of the operation.

Dunlap launched the Meta 1 token in April 2018 with Bowdler who is considered to have a smaller part in the scam.

The SEC’s March filing comment on Bowlder’s methods of attracting investors:

Bowdler claims to use her ‘psychic expertise’ to provide investment guidance to listeners who share her beliefs, encouraging them to invest in Meta1. In particular, Bowdler claims to be an ‘Earth Angel incarnated to help humanity,’ and purports to regularly channel and commune with angels, including the mythical angel, Metatron, who frequently teaches her about ‘the realities of our world.’

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