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“"I would watch hours until I really got a solid grasp of what was happening to me and what to expect,"”
What should you expect after federal crypto charges?
Federal agents came to Hugo Mejia's home in Ontario, California.
Hugo had served in the Army, taught school, and earned an MBA. He had also been running a Bitcoin-for-cash business.
Afterward, searching online late one night, he found my videos on federal sentencing. If you're the one up at night typing your charges into a search bar, start where he had to start.
Read your indictment before you read the internet
People in Hugo's position search for "crypto fraud charges." Hugo wasn't charged with fraud. He was prosecuted for money laundering conspiracy and for operating an unlicensed money transmitting business under 18 U.S.C. § 1960.
The difference matters. Each statute carries its own elements, its own maximum, and its own path through the sentencing guidelines. A § 1960 count, for example, can turn on whether a business that moved money for customers was licensed or registered as required. Much of what you read about crypto fraud may have nothing to do with your case.
Before you read another article, get your charging document in front of you. Write down every statute it cites. Then ask your defense attorney to walk you through what each one means for you.
Boyle Heights to Ontario
Hugo grew up in Boyle Heights, in East Los Angeles. As a teenager, he rode a bus for an hour to work at a liquor store. He joined the Army at 18 and later became a teacher.
In 2018 he started exchanging Bitcoin for cash, charging customers lower fees than some Bitcoin ATMs. The business grew. Some transactions involved very large amounts of cash. He had growing concerns about what he was doing, and he kept going.
A reporter read the drafts
Hugo started working with our team on his personal narrative, his presentence interview, and his plans for prison. I worked with him, along with Brad Rouse and others on our team. His defense attorneys handled the legal advocacy.
A reporter was in the room for much of it. Jack Hitt of The New York Times Magazine sat in on Hugo's consultations with me, read drafts of his narrative, and attended his sentencing hearing. The magazine published his story on June 7, 2022, under the headline "Want to Do Less Time? A Prison Consultant Might Be Able to Help." I'm not a prison consultant, but I'll take the headline for the reporting under it.
Hugo's narrative opened with shame and responsibility, not with his résumé. It covered his upbringing, his military service, his career, and the decisions behind the offense. It documented his therapy, his volunteer work with Prison Professors Charitable Corporation, and his efforts to build a lawful business.
Every draft had to hold up to a skeptical stranger whose job was to find the weak spot. Yours will face the same test. The probation officer, the prosecutor, and the judge all read your narrative looking for the line that sounds rehearsed.
The first voice at the hearing may be the prosecutor's
Hugo was sentenced by Judge Cormac Carney in Santa Ana.
The prosecutor spoke about Hugo's military service and his remorse, and recommended a sentence at the low end of the advisory range. The defense argued for probation.
Your record doesn't only reach your side of the courtroom. Build it knowing the government will read it too.
Judge Carney imposed 36 months and recommended Sheridan Federal Prison Camp in Oregon.
Sheridan
Before he surrendered, our team worked with Hugo on preparing for prison and on the Residential Drug Abuse Program. He completed RDAP and came home in less than twelve months.
The article ran after his sentencing. It left behind a public, dated account of the work he did before his hearing, written by someone with no reason to flatter him.
Questions people ask about federal crypto cases
Is every crypto case a fraud case? No. Prosecutors also bring money laundering, unlicensed money transmitting, tax, and sanctions charges in cases involving digital assets, with or without a fraud count. Your charging document tells you which.
What is an unlicensed money transmitting business? Federal law, including 18 U.S.C. § 1960, makes it a crime to run certain money transmitting businesses without required state licenses or federal registration. Whether it applies depends on the conduct.
Does RDAP shorten a sentence? Eligible people who complete it may receive a reduction under Bureau of Prisons rules. Completion doesn't guarantee a release date.
Print the latest draft of your narrative. Hand it to the most skeptical person you know and ask them to circle every sentence they don't believe. Hugo's drafts had to survive a reporter from The New York Times. Yours only has to survive the people deciding your sentence.
Thank you,
Justin Paperny
Written by
Justin Paperny
Founder White Collar Advice