DALLAS (AP) — The CEO of Dallas-based AriseBank was arrested Wednesday by the FBI in a cryptocurrency scheme that tricked hundreds of investors out of more than $4 million, according to a federal prosecutor.

Jared Rice Sr. was indicted on three counts of wire fraud and three counts of securities fraud, U.S. Attorney Erin Nealy Cox’s office said in a statement.

Prosecutors said that Rice claimed AriseBank could offer consumers FDIC-insured accounts and Visa-brand debit and credit cards, along with cryptocurrency services.

gettyimages 951165942 e1543523361308 Dallas CEO Arrested In Cryptocurrency Scheme

In this photo illustration of the litecoin, ripple and ethereum cryptocurrency ‘altcoins’ sit arranged for a photograph beside a smartphone displaying the current price chart for ethereum on April 25, 2018 (Photo by Jack Taylor/Getty Images)

But AriseBank was not FDIC insured and “did not have any sort of partnership with Visa,” the statement said.

The federal indictment added that Rice knew “AriseBank was not a bank and had not been authorized by the Texas Department of Banking to conduct business” in the state.

Rice started to promote AriseBank in 2017, according to the indictment, and promoted a new cryptocurrency called AriseCoin that was to be sold by AriseBank through an “initial coin offering.”

Rice is accused of falsely claiming in January that AriseCoin had raised $600 million within a few weeks. Prosecutors also said Rice converted investor funds for his own use and spent the money on clothing, food and hotels.

The indictment comes after the Securities and Exchange Commission earlier this year filed a complaint against Rice, AriseBank, and co-founder and COO Stanley Ford.

(© Copyright 2018 The Associated Press. All Rights Reserved. This material may not be published, broadcast, rewritten or redistributed.)

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