SPANISH FORK, Utah (ABC4) – A Spanish Fork man and two of his businesses have been charged by a federal grand jury in connection with multiple financial fraud schemes, according to the Department of Justice (DOJ).
James Wolfgramm, 43, and his businesses Bitex LLC and Ohana Capital Financial, Inc. (OCF), face seven felony counts — five counts of wire fraud and two counts of money laundering.
According to the allegations contained in the indictment, since at least 2018, Wolfgramm “represented himself on social media and in private communications as a multimillionaire” who made his fortune in cryptocurrency, the DOJ states.
To gain trust with victims and attract them to his businesses, Wolfgramm reportedly used images of cryptocurrency wallets “holding millions of dollars’ worth of cryptocurrency, a suitcase full of cash, and social media posts of expensive sports cars,” which he claimed to own, according to the DOJ.
However, some of these images were believed to have been taken from websites and social media feeds of others.
The indictment further alleges that Wolfgramm and Bitex collected nearly $1.7 million from two victims by purporting to sell a “high-powered cryptocurrency mining machine,” called the “Bitex Blockbuster,” which did not actually exist. According to the indictment, Wolfgramm and Bitex displayed one of these purported machines in Bitex’s office space, connected to a monitor that “appeared to display the machine’s real-time mining operations.”
In reality, the DOJ says the machine was fake, and the monitor displayed a pre-recorded loop that simply gave the appearance of mining activity.
The indictment also alleges that Wolfgramm and OCF marketed the business with the motto, “Banking the Unbankable,” and claimed to offer financial services to entities “ineligible for traditional bank accounts.”
According to the indictment, OCF’s websites falsely claimed to have a Board of Advisors and “falsely promised that OCF customer funds were bonded.” As a result of the false claims, OCF reportedly received millions of dollars from customers, who believed their money would be “kept on deposit” until they directed the release of their funds.
Instead, Wolfgramm and OCF spent these funds on “unrelated business expenses,” the DOJ says. One instance includes providing a refund to a prior, unrelated depositor.
In the final scheme alleged in the indictment, Wolfgramm “fraudulently agreed to purchase the Sports City complex and land in Draper” for $15 million in 2021.
Wolfgramm gained possession of the property and took over billing for all Sports City customers, allegedly collecting close to $160,000, “without ever paying any utilities or expenses on the property and without making any of the promised payments to the seller on the sales contract,” according to the indictment.
As part of the fraud, Wolfgramm reportedly gave the victims a $1 million check that bounced. Wolfgramm later claimed to have paid more than $255,000 in taxes for the property.
According to the indictment, however, that payment failed, and Wolfgramm “knew the account from which it was purportedly drawn had insufficient funds.”
According to the DOJ, Bitex is named in two wire fraud counts, while OCF is named in two wire fraud counts, as well as two money laundering counts.
Wolfgramm, Bitex, and OCF are set to be arraigned in federal court on these charges.
If you believe you have been a victim of this crime, please call the FBI at (801) 579-1400.