Las Vegas Business Owner Convicted in $24 Million Cryptocurrency Ponzi Scheme

A Scheme Built on False Promises

Through his Las Vegas-based company Profit Connect, which operated from late 2017 until July 2021, Brent C. Kovar enticed hundreds of investors with extraordinary promises. He offered guaranteed annual returns ranging from 15% to 30%, promised to return investors’ full capital if desired, and claimed the company maintained hundreds of millions of dollars in cryptocurrency reserves to back these commitments. In reality, according to prosecutors with the Justice Department, Profit Connect held no such reserves, generated no profits from cryptocurrency mining or transactions, and possessed no legitimate means of fulfilling its advertised returns. To make the fraud more convincing, Kovar falsely assured investors that their funds were insured by the Federal Deposit Insurance Corporation—a claim that had no basis in fact.

How Profits Were Diverted

Rather than investing in cryptocurrency infrastructure or mining operations, money flowing from victims was channeled toward personal enrichment and operational costs. Funds paid for the company’s day-to-day operations, employee gifts, and a house purchased for Kovar himself. To perpetuate the illusion that the scheme was generating returns, Kovar used money from newly recruited investors to pay earlier participants, falsely characterizing these transfers as mining income. This classic Ponzi structure allowed the fraud to continue undetected for years.

Kovar’s mother, Joy, who was 86 at the time, worked alongside him in operating the scheme. According to the Securities and Exchange Commission, which shut down Profit Connect in July 2021, approximately $1.2 million flowed into Joy’s personal bank account through ten equal transfers completed over fewer than two months. An additional $1.7 million was withdrawn through cash transactions, credit card charges, and the purchase of an automobile. The SEC’s investigation revealed that over 90% of Profit Connect’s total revenue came from investor funds, none of which was actually deployed toward cryptocurrency trading or legitimate mining activities.

Conviction and Consequences

A federal jury convicted Kovar on August 24, 2026, following a nine-day trial, finding him guilty on 11 counts of wire fraud, two counts of mail fraud, and two counts of money laundering. The Justice Department, working alongside the FBI, IRS Criminal Investigation, and the FDIC Office of Inspector General, established that the scheme defrauded at least 400 investors of $24 million. When the SEC initially obtained a restraining order and asset freeze in July 2021, it calculated losses at approximately $12 million. The expanded investigation by federal prosecutors established the true scope of the fraud. Kovar faces a statutory maximum of 280 years in prison, with sentencing scheduled for November 30, 2026.

This case underscores how fraudulent cryptocurrency schemes continue to exploit investor enthusiasm for digital assets, eroding market confidence and highlighting why regulatory vigilance remains essential for protecting the broader crypto community.

Source: Justice Department, via Decrypt. Not financial advice.