Morgenthau's lawyers sought probation, saying it was the
best way for him to earn money to pay restitution.
(Reporting by Luc Cohen in New York, editing by Deepa
Babington)
By Luc Cohen
NEW YORK, April 27 (Reuters) - A former chief financial
officer of multiple special purpose acquisition companies
(SPACs) was sentenced to three years in prison on Thursday for
embezzling more than $5 million from them, and losing almost all
of it trading meme stocks and cryptocurrencies.
Cooper Morgenthau, 36, of Fernandina Beach, Florida, pleaded
guilty to one count of wire fraud in January.
He was sentenced by U.S. District Judge Paul Engelmayer in
Manhattan federal court. Morgenthau also agreed to forfeit $5.11
million in money earned from the scheme and pay an equal amount
in restitution. He previously settled related U.S. Securities
and Exchange Commission civil charges.
Authorities said that between June 2021 and August 2022,
Morgenthau stole more than $1.2 million from African Gold
Acquisition Corp , concealed the theft by falsifying its
account statements, and spent or lost all of it in securities
trading.
To cover his losses, Morgenthau then raised $4.7 million
from investors in a SPAC known as Strategic Metals Acquisition
Corp., only to lose most of it through crypto trading, the SEC
said.
African Gold, which is based in New York and was created to
buy a gold mining business, had raised $414 million in a Feb.
2021 initial public offering.
It fired Morgenthau last August after he ran out of money
and vendors refused to work for the company, the SEC said.
African Gold said at the time it terminated Morgenthau after
learning about his "improper withdrawals" and attempts to
conceal them.
Federal prosecutors in Manhattan recommended a prison
term shorter than six years, citing Morgenthau's acceptance of
responsibility.
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