A former Los Angeles County Sheriff’s deputy, Michael David Coberg, has pleaded guilty to serious charges of conspiracy related to extortion and violations against rights while collaborating with notorious crypto entrepreneur Adam Iza, often referred to as the “Crypto Godfather.” The admissions of guilt, made in federal court, shed light on a shocking scheme that involved armed extortion, a fabricated drug arrest with planted narcotics, and a blatant abuse of police authority, as outlined by the U.S. Attorney’s Office for the Central District of California.
Coberg’s involvement with Iza, who ran the now-defunct cryptocurrency trading platform Zort and has been in federal custody since September 2024, included acting as a business partner and advisor. According to Coberg’s plea agreement, he used his position as an active officer to interrogate victims, facilitate false arrests, and extort hundreds of thousands of dollars, securing at least $20,000 per month for his efforts.
One particularly alarming aspect of the case involves Coberg’s direct role in intimidating victims. Reports indicate that he collaborated with Iza to coerce one businessman into transferring $127,000 at gunpoint and orchestrated a false drug arrest of another individual in Paramount. This misuse of law enforcement power raises significant concerns about accountability and oversight in policing, especially regarding off-duty officers engaging in illicit activities.
Kadan Stadelmann, Chief Technology Officer at Komodo Platform, remarked on the alarming implications of Coberg’s actions, stating that police officers should not use their badges in off-duty roles due to the potential for corruption and intimidation of citizens. He described Coberg’s case as a “next level of crypto malfeasance,” significantly exacerbating the traditional scope of cryptocurrency fraud.
Coberg is slated to be sentenced on February 17, 2026, facing a maximum of 20 years in federal prison for the extortion charge and up to 10 years for the conspiracy against rights charge. He is not alone in facing justice; other deputies involved in similar misconduct, including Christopher Michael Cadman and David Anthony Rodriguez, have also pleaded guilty and are awaiting their respective sentencings.
Over the course of his fraudulent operations, Iza reportedly amassed $16 million in cryptocurrency and extravagantly spent about $10 million on luxury items, often with his former girlfriend, Iris Ramaya Au, who herself pleaded guilty to failing to report $2.6 million in illicit proceeds.
This case illustrates the dangerous crossover between law enforcement and criminal activities, highlighting the urgent need for improved oversight and accountability mechanisms to prevent the misuse of power by public officials.
