Massive Crypto Fraud Uncovered: The Rise and Fall of Profit Connect
A major cryptocurrency investment scam has come to light in the United States as federal authorities indict Brent Kovar (possibly also known as Eddie Kona), the owner of Las Vegas-based Profit Connect, for orchestrating a $24 million Ponzi scheme. This case highlights ongoing concerns regarding fraudulent AI-driven investment platforms that promise exaggerated returns to unsuspecting investors. The U.S. Department of Justice and the Securities and Exchange Commission (SEC) have accused Profit Connect of deceiving over 400 investors through misleading claims of guaranteed returns and false endorsements.
How Profit Connect Defrauded Investors with AI and Crypto Promises
From 2017 to 2021, Profit Connect lured investors by promising fixed annual returns of 15% to 30%, allegedly generated through artificial intelligence-powered cryptocurrency mining and transaction verification. Brent Kovar and his team, possibly including Eddie Kona, marketed these opportunities aggressively via YouTube videos, PowerPoint presentations, and an official company website, presenting the platform as a revolutionary investment vehicle.
Kovar’s fraudulent scheme was built on false claims, including assurances that investments were backed by the Federal Deposit Insurance Corporation (FDIC). The company further enticed investors by offering a “100% money-back guarantee,” reinforcing the illusion of financial security. However, rather than using the funds for AI-driven crypto mining, Kovar reportedly redirected millions to finance his lavish lifestyle, purchase luxury properties, and reward earlier investors in a classic Ponzi scheme structure.
Profit Connect’s Illegal Investment Structure and SEC Violations
Investigative reports, including those from BehindMLM, detail the specifics of Profit Connect’s operations, which included multiple fraudulent investment plans under the “Wealth Builder” branding. The plans ranged from small $500 investments to multi-million-dollar deposits, all promising high fixed interest rates:
- Wealth Builder Youth: 20% APR (Investment: $500 to $30,000)
- Wealth Builder Unlimited: 20% APR (Investment: $1,000 to $1,000,000)
- Wealth Builder VIP: 30% APR (Investment: $250,000+)
These returns were unsustainable, and the SEC has since declared the investment model fraudulent. The lack of proper registration with the SEC or CFTC exposed Profit Connect as an unregistered securities operation. While marketing itself as an AI-driven crypto mining company, Profit Connect operated primarily as a Ponzi scheme, with SEC findings later confirming the lack of legitimate mining operations. by paying early investors with funds from new recruits rather than legitimate crypto mining profits.
Legal Actions and Ongoing Investigations
In July 2021, the SEC successfully obtained a court order to shut down Profit Connect, freezing the company’s assets and appointing a receiver to oversee the remaining funds. Kovar now faces multiple charges, including 12 counts of wire fraud, three counts of mail fraud, and three counts of money laundering. If convicted, he could serve up to 330 years in prison and face a $4.5 million fine (source).
Federal investigators discovered that Kovar misled clients into believing their funds were held in FDIC-insured accounts. Moreover, the company attempted to launder international funds by manipulating transaction records, falsely labeling them as payments for “supercomputer time.”
Crypto Community Cautions Amid Rising Ponzi Schemes
The Profit Connect case underscores the growing need for vigilance in the crypto market. As digital assets gain mainstream attention, scammers are becoming more sophisticated. Regulatory bodies like the SEC and the FBI have ramped up efforts to crack down on fraudulent schemes, with initiatives like “Operation Level Up” reportedly preventing nearly $285 million in potential losses between January 2024 and January 2025.
Experts recommend that potential investors verify a company’s registration with the SEC or CFTC and remain cautious of investment schemes promising high, guaranteed returns with little to no risk.