United States Attorney Cole Finegan | U.S. Department of Justice
Jonathan Arvay, a 38-year-old resident of Denver, has been sentenced to one year and one day in prison. The sentencing follows his conviction by a federal jury on charges of conducting an illegal gambling business and conspiracy to conduct such activities.
Arvay was found to have operated Player One Arcade in Denver, which was part of a larger network of gambling parlors stretching from Greeley to Pueblo. These establishments offered electronic gambling through games designed to mimic arcade experiences and virtual slot machines. Customers could earn credits during gameplay, which were then exchanged for a cryptocurrency called Obsidian Digital Asset Coin (ODAC). This cryptocurrency's sole purpose was to be converted into cash at ATM-like machines located next door or within the parlors themselves, with customers paying a transaction fee for the exchange.
Acting United States Attorney Matt Kirsch commented on the case, stating: “This was a modern version of old-fashioned illegal gambling. I am grateful for our local and federal partners who helped put this criminal in prison.”
FBI Denver Special Agent in Charge Mark Michalek added: “This sentence reflects an appropriate resolution to a complicated case: When you launder money and commit fraud against the government, the FBI and our partners will track you down across jurisdictions.”
Tom Demeo, Acting Special Agent in Charge at the IRS Criminal Investigation Denver Field Office, remarked on their role in cybercrime investigations: “IRS-CI remains on the cutting edge of cybercrime investigations as financial crimes continue to become more sophisticated. We are committed to staying one step ahead of criminals and leveraging our partnerships with federal and local law enforcement agencies to protect the U.S. tax system.”
The trial was overseen by United States District Judge Gordon P. Gallagher. The investigation involved collaboration between the FBI Denver Field Division, IRS Criminal Investigation Denver Field Office, and Pueblo Police Department. Prosecution efforts were led by Assistant United States Attorneys Cyrus Y. Chung, Alison Connaughty, and Jena Neuscheler.
