HyperFund Ponzi promoter Rodney Burton was arrested en route to Dubai back in January.

Since then Burton has been in custody pending the outcome of him criminal case.

On June 16th, Burton filed a motion requesting a review of his detention. Burton’s motion was denied on July 9th.
In his motion, Burton (right) acknowledges the court deemed him to be a serious flight risk.

The Court found by a preponderance of the evidence that there was a serious risk that the defendant would not appear.

Further, that the “nature/circumstances of offense involve significant amount of assets; weight of the evidence is strong (witnesses, transaction records, recorded calls); history/characteristics of Defendant; significant assets ($40k/month in income, yacht, vehicles), arrest at airport with 1-way ticket to UAE”.

Citing the Bail Reform Act, Burton’s attorney argued he was “entitled to a presumption [he wouldn’t flee] in favor of release pending trial.”

This argument was based on Burton’s charges being non-violent and that Burton, a serial promoter of fraudulent investment schemes, did not know HyperFund was a Ponzi scheme.

Contrary to the Government’s claim of substantial evidence of Mr. Burton’s involvement in this “Ponzi Scheme”, an objective review of the transaction records and the recorded phone call does not establish the Mr. Burton had actual knowledge of a “Ponzi Scheme” or intent to further a conspiracy.

Bizarrely, in an attempt to discredit the DOJ’s assertion that he intended to flee to Dubai, Burton’s attorneys quote evidence that supports Burton intending to flee to Dubai.

At the detention hearing the government relied on a recorded phone call between Mr. Burton and government cooperator, Brenda Chunga, that occurred on December 22, 2023.

An objective review of the recording in its entirety does not support the Government’s theory of Mr. Burton’s consciousness of guilt, or evasion of prosecution.

In response to Ms. Chunga’s statement regarding prior business dealings involving cryptocurrency, Mr. Burton shared that he has also been affected and that he was dealing with active court cases in which he had already gone to Court for, expressing that “motherfucking feds out here, man, doing investigations on me, doing all kinds of shit” Recording at minute 28.50.

Further, Ms. Chunga asks Mr. Burton that given what he’s going through “doesn’t that make you just want to just stop and not do this crypto thing since it’s the wild-wild west out here?” Recording at minute 29.

To which Mr. Burton responded in part “No, I mean as long as you do what you supposed to do, you do it right …. I want to keep on trying, I want to win, you know and if I do die, I want to die trying, you know, die on my feet, not on my knees… fighting the good fight.

Recording at minute 29 – 30. Subsequently, Mr. Burton states that “in Dubai also, it’s where, it’s legal to do crypto”.

Burton’s attorney claims his quoted statements are “self-serving excerpts … entirely taken out of context”.

It should be noted that Burton hasn’t been charged with “doing crypto”. Burton has been charged with charged with conspiracy to operate an unlicensed money transmitting business and operating an unlicensed money transmitting business.

As another prominent HyperFund promoter, Brenda Chunga (right) has already pled guilty to conspiracy to commit both securities and wire fraud.

In their July 1st filed response to Burton’s motion, the DOJ opposed on the grounds Burton remained a “severe flight risk”.

HyperFund was a Ponzi scheme.

Burton received hundreds of wire transfer and cashier’s checks totaling over $7,500,000 from individuals who wished to invest in HyperFund. Approximately three hundred transactions totaling over $5,000,00 were made after HyperFund began blocking investor’s ability to withdraw funds.

Simply put, Burton took investors’ valuable fiat currency and transferred worthless HU from his HyperFund account to the investors’ HyperFund account.

Additionally, Burton has significant assets that could facilitate his flight, has weak ties to the District of Maryland, and has a demonstrated disregard for governmental authority. All that militates in favor of detention.

In support of their assertion, the DOJ quotes the same phonecall between Burton and Chunga as Burton’s own attorney’s did.

Burton’s meaning was clear: He wanted to try to “win” by continuing to participate in cryptocurrency schemes. And he wanted to do so in Dubai, where crypto was “legal” (unlike in the United States, in Burton’s view), and where he would be beyond the reach of the “[m]otherfucking feds” investigating him.

Sam Lee, co-founder of HyperFund, is cited as an example and co-conspirator doing exactly what Burton allegedly planned to do.

Another defendant charged in this Court in the HyperFund scheme, Sam Lee, the CEO of HyperFund, is currently believed to be in Dubai and avoiding answering for his crimes before this Court, just as Burton appears to have hoped to do.

Addressing Burton’s attorney’s argument about the recorded phone-call directly, the DOJ stated;

Burton argues that when he referred to the “feds . . . doing investigations” on him, he was not necessarily “aware of this specific federal investigation.”

The fact that Burton may have been unaware of this investigation and wanted to go to Dubai to avoid other cases or investigations is unavailing.

To the contrary, it reinforces that Burton wanted to go to a jurisdiction where he could continue to participate in cryptocurrency-related schemes, beyond the reach of federal investigators.

That is the same jurisdiction where the CEO of HyperFund is also currently hiding out to escape justice.

Shockingly, despite being in detention and facing serious prison time, the DOJ reveals Burton is still attempting to relocate undeclared assets to Dubai.

After attempting unsuccessfully to flee to Dubai to avoid federal prosecution, Burton—even while detained—has continued to violate the law and attempt to move assets to Dubai.

On May 9, 2024, CBP Savannah discovered an unmanifested 2022 Rolls Royce Cullinan, SLATV8C08NU214816, registered to “Bitcoin Rodney, LLC” on a container ship bound for Dubai.

In other words, it appears that Burton and his associates are still attempted to move Burton’s property to Dubai, where it will be outside the reach of law enforcement officers.

The government’s investigation also revealed that Burton has at least one bank account that he controls in Dubai, and he has made financial transfers to that account from his U.S.-based accounts.

In addition, investigators have recovered what appears to be a UAE residence permit that expires on September 14, 2024.

Evidence also indicates that Burton is the in the process of liquidating a variety of U.S.-assets, including selling various properties valued at millions of dollars.

The DOJ also brings up Burton’s criminal past and ongoing substance use.

Burton is not new to the criminal justice system.

In 2007, he was convicted of conspiracy to distribute 500 grams or more of cocaine, in violation of 21 U.S.C. § 846.

In that case, defendant Burton received a 60-month sentence. Burton also appears to have made conflicting statement to Pretrial Services representatives in Florida and Maryland in this case about his use of cocaine.

Specifically, before his Rule 5 hearing in the Southern District of Florida, Burton told probation officers that he last used cocaine “ten years ago.”

But Burton then reported to pretrial officers in the District of Maryland that he used cocaine on New Year’s Eve 2023—days before his arrest in this case.

This follows on to the DOJ asserting Burton’s aunt, a proposed custodian, being unsuitable for the role.

Burton proposes that he be released to the custody of his aunt.

At this time, the government has limited information regarding whether this proposed custodian can offer the supervision and moral suasion to ensure Burton’s appearance.

However, when interviewed by pretrial services, Burton’s aunt denied that Burton has any history of use of illicit substances.

That statement, coupled with Burton’s prior conviction and admission that he used cocaine on New Year’s Eve, calls into question whether his aunt is truly aware of her nephew’s actual behavior.

At a minimum, it suggests she would not be a suitable custodian.

Perhaps not surprisingly, like a lot of crypto bros Burton was also a sovereign citizen nutjob.

Burton also appears to believe that he is not subject to U.S. criminal jurisdiction.

At the time of his arrest, Burton was in possession of a 27-page packet documenting his participation in the “sovereign citizen” movement.

The exhibited documents detail Burton’s attempts to “put himself beyond the reach of the legal system.”

There is every reason to think Burton would evade prosecution if given the chance.

Burton’s professed belief that he is not subject to governmental authority, taken together with his demonstrated intent to escape the “feds” and his significant assets, weighs strongly in favor of detention.

As to Burton not knowing HyperFund was a Ponzi scheme, the DOJ asserts

Burton is charged only with operating an unlicensed money transmitting business and conspiring to do the same; neither charge requires evidence that Burton knew that HyperFund was a Ponzi scheme.

However, evidence indicates Burton was not an unknowing dupe when it came to HyperFund being a Ponzi scheme.

For starters, Burton billed himself as a deeply knowledgeable crypto investor. And, in a previously recorded conversation in New York, Burton admitted that he knew a previous collapsed cryptocurrency scheme he had promoted was also a Ponzi scheme.

Perhaps “Bitcoin Rodney” was fooled once, but it strains credulity to believe he was fooled twice.

All said and done, the DOJ concluded;

There is no condition or combination of conditions that can reasonably assure Burton’s presence at future court appearances.

On July 9th the court sided with the DOJ and denied Burton’s motion for release.

The nature and circumstances of Burton’s offense are serious. He is alleged to have acted as an unlicensed money transmitter as part of an almost $2 billion cryptocurrency fraud scheme, taking millions of dollars and givign them worthless cryptocurrency in return.

Additionally, the weight of the evidence against Burton is strong.

The indictment outlines evidence of hundreds of illegal money transfer transactions performed by defendant Burton, who was clearly knowledgeable about cryptocurrency and went by the professional name “Bitcoin Rodney” – a public moniker that Burton used as part of his fraud.

The phone call noted above is even greater evidence against Burton.

According, having reviewed the submissions of the parties and considering … factors including the nature of the offense charged, the weight of the evidence against the defendant, the defendant’s history and characteristics, and the danger he possesses to the community, Defendant’s Motion for Review of Detention Order is DENIED.

Stay tuned for updates as BehindMLM continues to track Burton’s HyperFund case.