LA Deputy Misused Badge in Extortion Scheme Linked to Cryptocurrency Figure

A former deputy of the Los Angeles County Sheriff’s Department has confessed to misusing his badge and authority to assist a cryptocurrency promoter in extortion and fraud operations.

Michael David Coberg, 44, from Eastvale, entered a guilty plea on Tuesday to federal conspiracy charges after prosecutors outlined how he collaborated with 25-year-old Adam Iza, a self-proclaimed Beverly Hills “Godfather” notorious for orchestrating crypto scams.

As per court documents, Coberg received a minimum of $20,000 monthly from Iza to serve in a capacity beyond mere security. The two contemplated starting a steroid business together and worked closely to intimidate competitors.

Their methods reportedly involved threats, extortion, and even a fabricated drug arrest aimed at framing one of Iza’s rivals.

This case illustrates how individuals engaged in the cryptocurrency sector have occasionally sought legitimacy or force through connections with law enforcement. For Coberg, it involved utilizing his position as both a sheriff’s deputy and a helicopter pilot to enhance Iza’s operations.

Officials state that Coberg’s guilty plea brings him closer to sentencing, although specifics regarding potential prison time have yet to be determined. Meanwhile, Iza continues to confront multiple fraud and extortion charges related to his cryptocurrency activities.

Ex-LA Deputy and Crypto Promoter Face Prison in Violent Extortion and Kidnapping Conspiracy

The scope of the conspiracy involving former Los Angeles County deputy Michael David Coberg and cryptocurrency promoter Adam Iza became more apparent this week as prosecutors disclosed alarming details of the schemes that left victims financially devastated and physically threatened.

Michael David Coberg, 44, of Eastvale, and former LASD deputy, pleaded guilty to federal conspiracy charges for assisting a now-incarcerated, self-proclaimed cryptocurrency entrepreneur in extorting a competitor and arranging the false illegal drug possession arrest of another adversary in Paramount in… pic.twitter.com/HCJ8vURW3C

— FBI Los Angeles (@FBILosAngeles) September 30, 2025

In October 2021, Coberg directly aided Iza in pressuring a victim, referred to in documents only as “L.A.,” during a meeting at Iza’s home.

Prosecutors assert that Iza orchestrated the meeting by displaying firearms, while Coberg intensified the intimidation by identifying himself as an active-duty sheriff’s deputy and interrogating the victim. The pressure proved effective—L.A. transferred $127,000 directly to Iza’s account that same day.

The following morning, the situation escalated. At a private shooting range, Iza allegedly held the victim at gunpoint while making additional financial demands. L.A.’s business partner ultimately sent more funds to ensure his release, according to investigators.

Just weeks prior, Coberg was also involved in another intricate scheme targeting a second victim, “R.C.” Court documents indicate that the conspirators deceived R.C. into traveling from Miami to Los Angeles under the pretense of a romantic reunion with his ex-girlfriend.

Upon arriving in California, Coberg coordinated with another deputy, Christopher Michael Cadman, to execute a fabricated traffic stop in Paramount.

Deputies allegedly placed narcotics in R.C.’s belongings, leading to his arrest. Coberg, prosecutors noted, drove past the scene while Iza filmed video and took photographs of the staged arrest for leverage.

Cadman has already pleaded guilty to related federal charges and is set for sentencing in January 2026. Coberg, who has pleaded guilty to conspiracy to commit extortion and conspiracy against rights, now faces a potential 30-year federal prison sentence when he returns to court on February 17, 2026.

Iza, the so-called “Godfather” behind the operations, remains in federal custody and is awaiting sentencing on December 15. The FBI and IRS Criminal Investigation are spearheading the case with assistance from the Los Angeles County Sheriff’s Department.

This case has garnered significant attention regarding how deeply organized fraud networks can infiltrate law enforcement. Federal prosecutors stated that Coberg’s actions not only violated his oath as a deputy but also weaponized the authority of his badge against private citizens in service of a crypto-driven criminal enterprise.

Growing Numbers of Fraudulent Crypto Schemes

In August 2024, the SEC charged brothers Jonathan and Tanner Adam with a $60 million Ponzi scheme, alleging they deceived over 80 investors with a fraudulent crypto trading bot. The bot promised 13.5% monthly returns from January 2023 to June 2024.

The SEC has filed charges against two brothers for allegedly orchestrating a $60 million cryptocurrency Ponzi scheme centered around a fraudulent trading bot.#SEC #Ponzihttps://t.co/ILsxOEysiM

— Cryptonews.com (@cryptonews) August 27, 2024

A week earlier, Montenegrin authorities apprehended Roman Ziemian, co-founder of the alleged $21 million crypto fraud scheme FutureNet, in Podgorica, where he was living under a false identity. Ziemian was wanted in South Korea and Poland on charges of fraud, money laundering, and theft.

A month later, a U.S. federal court ordered New York resident William Koo Ichioka to pay over $36 million in restitution and penalties for operating a fraudulent cryptocurrency and forex investment scheme. His scheme promised unrealistic returns, following a case initiated by the Commodity Futures Trading Commission (CFTC).

A New York man has been fined $36 million for orchestrating a fraudulent crypto and forex scheme!#CryptoFraud #CryptoScamhttps://t.co/HYxR4lCSJ0

— Cryptonews.com (@cryptonews) September 23, 2024

However, institutions and governments have been implementing measures to combat fraudulent schemes. Circle, the issuer of the $74 billion USDC stablecoin, is investigating refund options for disputed or fraudulent payments to align blockchain with traditional finance.

@Circle, the issuer behind $74 billion worth of USDC stablecoins, is exploring the possibility of enabling reversible transactions.#Circle #USDChttps://t.co/cV1behB1hD

— Cryptonews.com (@cryptonews) September 25, 2025

Meanwhile, the Reserve Bank of India has mandated dynamic authentication for all domestic digital payments by April 1, 2026. The authority requires at least one unique factor, such as an OTP or biometric, per transaction to mitigate fraud and extend protections to cross-border card usage.

The post Corrupt LA Deputy Weaponized Badge for ‘Crypto Godfather’ in Terrifying Extortion Racket appeared first on Cryptonews.