Senior School District Officials Face Charges for Alleged Illegal Crypto Mining Operation
Summary:
The U.S. Department of Justice has charged two senior members, Jeffrey Menge and Eric Drabert, of the Patterson Joint Unified School District for allegedly operating a cryptocurrency mining operation using school resources. The operation reportedly increased the schools' electricity costs and allowed the accused to embezzle significant amounts of money. This revelation comes amidst recent efforts by U.S. energy regulators to crack down on crypto miners to reduce energy wastage nationwide.
Accusations of illegal cryptocurrency mining utilizing resources from ten schools have been leveled against two high-ranking employees of Patterson Joint Unified School District, by the United States Department of Justice (DoJ). The DoJ claims that Jeffrey Menge, who holds the dual roles of assistant superintendent and chief business officer for the school district, collaborated with Eric Drabert, the IT director for the district, to establish and operate a cryptocurrency mining venture. The officials reportedly utilized computing power from high-end graphic cards, powered by the school district's electricity, to mine cryptocurrency, which was then moved to their personal digital wallets. It remains uncertain how many of the district's ten schools, which collectively cater to around 6,200 students, were exploited for this crypto mining operation, and the exact type of cryptocurrency mined has yet to be disclosed. Some popular choices among miners include Bitcoin (BTC), Monero (XMR), Ravencoin (RVN), and Dogecoin (DOGE).
CoinGecko's recent findings suggest that solo mining of a single Bitcoin, using approximately 266,000 kilowatt-hours of power, could span around seven years, with a monthly electricity usage averaging at 143kWh.
In addition to the crypto mining allegations, the accused duo are believed to have stolen significant sums during their scheme, with Menge believed to have embezzled between $1 - $1.5 million and Drabert accused of pocketing between $250,000 - $300,000.
These charges follow closely the crackdown by U.S. energy regulatory bodies on cryptocurrency miners as part of a wider movement to curb energy wastage. As of February 1, the United States Department of Energy (DOE) has mandated crypto miners to submit a record of their energy usage for the next half-year. This is in response to concerns surrounding increased crypto mining following recent inflation in Bitcoin's value.
Furthermore, the U.S. Energy Information Administration (EIA) is preparing to issue a survey, intended to assess the power consumption of domestic crypto mining businesses, commencing from next week. Miners are expected to provide detailed information regarding their energy usage.
Internationally, similar concerns have led to actions against excessive power consumption. Reports from December 2023 noted the closure of 10 Bitcoin mining farms in Indonesia by local law enforcement, after their operators were linked to an alleged theft of electricity worth nearly $1 million.
Published At
2/3/2024 8:27:41 AM
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