Former LA deputy jailed in crypto extortion case

A former deputy of the Los Angeles County Sheriff’s Department has been sentenced to more than five years in prison for helping a crypto founder carry out extortion schemes, according to US authorities.

A California federal court sentenced Michael Coberg to 63 months in prison and ordered him to pay $127,000 in restitution. He had previously pleaded guilty to conspiracy to commit extortion and conspiracy against rights.

Deputy linked to crypto founder’s extortion scheme

Prosecutors said Coberg worked with Adam Iza, founder of crypto trading platform Zort, who is also facing sentencing after pleading guilty to multiple extortion charges.

Coberg reportedly received at least $20,000 per month for providing security services to Iza.

In one case in 2021, Coberg helped detain a victim identified as “L.A.” and brought him to Iza’s residence. Prosecutors said the victim was forced to transfer $127,000 while Coberg stood guard.

Authorities added that the victim was later taken to a shooting range, where Iza allegedly used threats to pressure him into sending the funds.

Setup and arrest of another victim

Prosecutors also said Coberg was involved in a scheme targeting another individual, identified as “R.C.”

According to court documents, the group arranged a setup where R.C. was lured to Los Angeles under false pretenses. After obtaining drugs, R.C. was stopped and arrested by a deputy who had been tipped off in advance.

Officials said the scheme was designed to pressure the victim during an ongoing financial dispute.

Abuse of authority highlighted by prosecutors

Prosecutors said Coberg misused his law enforcement position to assist criminal activity.

In a sentencing memorandum, they stated that he abused the authority of his badge for personal financial gain.

The case is part of a broader crackdown on criminal activity linked to individuals in the crypto sector, as authorities continue to investigate misuse of digital asset-related businesses.