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Leaders of a fraudulent crypto firm dubbed OneCoin Ltd. are currently imprisoned and will possibly spend several years in prison following the charges brought upon them for creating and running a deceptive pyramid scheme involving the sale of a supposed crypto coin named OneCoin.
The firm, which was created in early 2014, was spearheaded by its founder Ruja Ignatova, until late 2017 when she disappeared from the eyes of the public. Soon enough – in about a year or less – her younger brother Konstantin Ignatov, picked up from where she left off and has since been in charge of the false crypto firm. The firm touted OneCoin as their crypto coin which holds value based on market demand.
Ignatov and his sister and other conspirators lured millions of unsuspecting investors into their net through a pyramid scheme where you get rewarded for referring a new member. They preached that the digital coin is registered and monitored on a dedicated blockchain and would be ripe to generate massive amounts of cash in the near future.
Alas, the investigation revealed that OneCoin Ltd. has no blockchain at all and was created for the sole purpose of defrauding investors. Records retrieved show that the company generated approximately €3.353 billion in sales between Q4 of 2014 and Q3 of 2016, making mind-blowing profits of about €2.232 billion.
Investigators also learned that the virtual coin has no real value and cannot be used to make any purchase whatsoever; instead, the value was manipulated by the leaders of the firm to continue to lead investors on. Also, the supposed crypto coin is not mined using any computer resources.
This discovery was made by the U.S. Attorney for the Southern District of New York named Geoffery S. Berman and a team consisting of the District Attorney for the County of New York, Cyrus R. Vance Jr., Special Agent in Charge of the Newark Field Office of the Internal Revenue Service-Criminal Investigation (IRS-CI), John R. Tafur, and the Assistant Director-in-Charge of the Newark Field Office of the Federal Bureau of Investigation (FBI), Williams F. Sweeney Jr.
Ignatov was arrested at the Los Angeles International Airport on March 6 after a recent business trip to the United States – Nevada and Las Vegas precisely – where he allegedly met with a number of OneCoin affiliates. He is currently being charged for wire fraud conspiracy, which may land him up to 20 years behind bars. A few days after his arrest, an indictment charging his sister Ignatova was released, charging her with securities fraud, money laundering, and wire fraud.
The investigation also revealed that they were aided by a former partner of a major U.S. law firm named Mark S. Scott. Scott was reportedly arrested in Barnstable Massachusetts in September last year and he is being charged by indictment with one count of conspiracy to commit money laundering.