OneCoin is considered one of the best-known and most successful fraud schemes in the world by Bitcoin & Co. Now, US authorities have arrested alleged mastermind Konstantin Ignatov. His sister Ruja Ignatova, however, remains at large. The authorities are looking for more wire-pullers.
One Coin to Rule them all: 3.8 billion US dollars is the proud sum, the mastermind behind OneCoin between the years 2014 (Q4) and 2016 (Q3) had captured. However, the OneCoin price rose dramatically, the authors pretended to have three million users worldwide. The Problem: It was one of the many useless coins that the crypto-hype and hope for the big money brought with it, the practical value was zero.
OneCoin mastermind Konstantin Ignatov arrested
As can now be seen from a statement by the Department of Justice of the State of New York, the authorities have now arrested the alleged mastermind Constantin Ignatov. That happened on March 6 at Los Angeles International Airport. Now he has to answer to the court over the alleged pyramid scheme. Together with his sister Ruja Ignatova and other masterminds, he is said to have brought false investors into believing investors worldwide for their money.
George S. Berman, attorney in Manhattan, summarized the allegations as follows:
“The defendants created a multi-billion dollar firm based entirely on lies and deceit, promising great returns and minimal risk, but […] it was a pyramid scheme that relied more on smoke and sound than on zeros and ones Harassed Investors While the Defendants Became Rich, Our Office has a long history of successfully combating, arresting and convicting financial fraudsters, and this case is no different. “
IRS Special Agent John R. Tafur once again described the suspected fraud as an “old scam with a new twist”. The idea behind snowball systems: investors are attracting new investors, who in turn promote further investors. With each new investment, some money is lost, which in turn flows to the masterminds. These attract with big returns. The system is old, the shift to digital promised a profit maximization through the easier global distribution.
Ruia Ignatova significantly involved
Konstantin Ignatov and his sister Ruja Ignatova can probably be described as the author of the alleged crypto-pyramid system. In 2014 Ruja founded the company in the Bulgarian capital Sofia. In October 2017, she then disappeared from the public, her brother came to the fore as far as possible. The coin itself should appear as a typical cryptocurrency. By crypto-mining, as it is known from Bitcoin, according to the information of the operator, the coins were digitally mined. The OneCoin course, on the other hand, referred to actual demand: the more people need it, the more it would rise in price.
However, as can be seen from the official documents, there has been neither the demand value nor the alleged prospecting facilities. Ignatov & Co. issued the OneCoins directly and determined their “value”. In addition, the operators pretended to have their own blockchain – this also turns out to be wrong in the meantime. Accordingly, the operators issued coins that never existed, but investors paid them for real money.
Here’s a video of how operators throw content-free buzz words:
Within two weeks you could improve your portfolio by becoming a marketing partner of the “One Network” and spreading it in public. In addition, one should form their own sales teams to build the pyramid on.
The actual payments have never been made. Rather, the operators are said to have laundered their money through various offshore banks such as the Cayman Islands.
Convictions are pending, homepage still online
The respective convictions are still pending. 38-year-old Ignatova has to file a lawsuit for wire fraud, a conspiracy to commit telecommunications fraud, and a money laundering crime, each punishable by up to 20 years in prison. She also faces prosecution for securities fraud, which can also result in a five-year sentence.
The 33-year-old Ignatov, in turn, has “only” to answer for telecommunications fraud. Here, too, threaten up to 20 years in prison.
The negotiations are still pending, judgments have not been made by the court. The official homepage is still online.