Trendon Shavers, a Texas man who ran a scam investment scheme called Bitcoin Savings and Trust, has been arrested in his home state.

The charges filed against Shavers today are one count of securities fraud and one of wire fraud, with each having a maximum penalty of 20 years and potential fines totaling upwards of $5m.

Shavers, 32, has already been fined $40m by a federal judge in north Texas in a Securities and Exchange Commission (SEC) -related case. This arrest is for criminal charges of fraud brought by the US Attorney in Manhattan.

By using the online monikers 'Pirate' and 'pirateat40', Shavers allegedly sold bitcoin investment opportunities on various online forums.

Calling his scheme Bitcoin Savings and Trust (BTCST), Shavers promised a 7% return per week to potential investors.

Shavers was able to amass over 700,000 BTC over a period of time stretching from September 2011 to September 2012, working on the scam from his home in McKinney, TX. The value of the bitcoin at the time of Shavers' initial SEC charges was approximately $64m.

The US Attorney's Office in Manhattan claims 48 of the 100 investors in the BTCST scam lost some or all of their money.

Shavers' previous SEC case in North Texas created precedent when his attorney claimed bitcoin was not subject to US securities laws that prohibit Ponzi schemes. The judge in that case, however, ruled that the scam had indeed violated those laws, which are designed to protect investors from fraud.

Earlier this year, officials in Texas issued a warning in regards to virtual currencies. Joseph Rotunda, director of enforcement at the Texas State Securities Board, indicated that bitcoin has huge trust issues because of little regulatory clarity.

At today's bitcoin prices, the roughly 700,000 BTC Shavers apparently scammed from investors would be worth $243m.

Arrested man image via Shutterstock