LOS ANGELES — Five men were charged Tuesday in connection with what federal prosecutors called a lucrative cryptocurrency scheme that fleeced investors out of $722 million in a business model that one of the defendants described as built "on the backs of idiots," according to court documents.

The 27-page indictment, unsealed in U.S. District Court in Newark, New Jersey, names Matthew Brent Goettsche, 37, of Lafayette, Colorado; Jobadiah Sinclair Weeks, 38, of Arvada, Colorado; and Silviu Balaci, whose age and residence were not immediately known, as part of a conspiracy to commit wire fraud. They were also charged with conspiracy to offer and sell unregistered securities.

"What they allegedly did amounts to little more than a modern, high-tech Ponzi scheme that defrauded victims of hundreds of millions of dollars," U.S. Attorney Craig Carpenito said.

Prosecutors allege that BitClub Network, which operated from April 2014 to this month, was built on soliciting money from individuals in exchange for shares of purported cryptocurrency mining pools and on rewarding investors for bringing in new clients. The group did not register shares sold with the U.S. Securities and Exchange Commission, the indictment alleges.

To bolster their business, Goettsche, Weeks and others conspired to solicit investments by providing false and misleading figures described as "bitcoin mining earnings," prosecutors alleges. Weeks and a fourth man, Joseph Frank Abel, 49, of Camarillo, California, created videos and traveled around the country and the world to promote BitClub Network, describing their firm as "the most transparent company in the history of the world that I've ever seen" and "too big to fail," according to prosecutors.

But behind the scenes, they appeared to combine greed, contempt for their investors and, at times, doubt about sustaining the scheme, according to prosecutors.

In February 2015, Goettsche directed Balaci to "bump up the daily mining earnings starting today by 60%," according to the indictment, to which Balaci is alleged to have warned "that is not sustainable, that is ponzi teritori [sic] and fast cash-out ponzi ... but sure."

Balaci told Goettsche not long after launching the company that their target audience would be "the typical dumb MLM (multi-level marketing) investor," according to the court filing. Months later, the complaint alleges, Goettsche told Balaci that "we are building this whole model on the backs of idiots" and that to "prove the mining ... just means convincing the morons Q."

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In September 2017, Goettsche sent an email to another alleged conspirator, suggesting that BitClub Network "[d]rop mining earnings significantly starting now" so he could "retire RAF!!! (rich as f---)," according to the indictment.

But court documents indicate that cracks were showing. Weeks remarked in an email to Goettsche and another accused conspirator in June 2017 that BitClub's selling shares and not using the money to buy mining equipment was "not right."

Four of the men were scheduled to make court appearances Tuesday. Authorities also are seeking a fifth man, whose identity was redacted pending his arrest.

If convicted, the defendants face maximum penalties of 20 years in prison and fines of up to $250,000 on the fraud conspiracy count. The charge of conspiracy to sell unregistered securities carries a maximum sentence of five years with a $250,000 fine.