OneCoin lawyer found guilty in ‘crypto-scam’
A US lawyer has been found guilty for his role in the OneCoin cryptocurrency scam, which raised billions of pounds from investors convinced they were buying into a new digital currency.
A New York jury found that Mark Scott helped to perpetuate the scheme, routing approximately $400m (£310m) out of the US while working to conceal the true ownership and source of the funds.
Prosecutors said he made about $50m.
Mr. Scott’s lawyers had said he did not know that OneCoin was worthless.
They said he was simply doing the job asked by Dr. Ruja Ignatova, a co-founder of the Bulgaria-based OneCoin.
The federal jury in Manhattan rejected those arguments, finding Mr. Scott guilty of conspiracy to commit money laundering and bank fraud.
US-based investors claiming to have been defrauded by the scheme are also attempting to sue Mr. Scott for recompense in a related case.
In total, investigators believe as much as £4bn was raised globally via what is said to have amounted to a Ponzi scheme, with investors based in Uganda, China, and the UK among other countries.
“This was, of course, completely false because the price of OneCoin was fiction and not based on supply and demand.”
However, the Bulgaria-based organization behind OneCoin Ltd continues to operate and denies all wrongdoing.
“OneCoin verifiably fulfills all criteria of the definition of a cryptocurrency,” it said in a recent statement given to The Missing Cryptoqueen, a BBC podcast.
It added: “Our partners, our customers, and our lawyers are fighting successfully proceedings against OneCoin. We are sure that the vision of a new system on the basis of a financial revolution will be established.”
‘Cryptoqueen’ brother admits role in OneCoin fraud
Konstantin Ignatov, the brother of “missing cryptoqueen” Dr Ruja Ignatova, has admitted his role in the OneCoin cryptocurrency fraud.
Ignatov pleaded guilty to several charges, including money laundering and fraud.
OneCoin and the disappearance of its co-founder, Dr Ruja Ignatova, have been the subject of a BBC Sounds podcast.
Investigators believe as much as £4bn was raised globally in what is said to have amounted to a Ponzi scheme.
The Bulgaria-based organization behind OneCoin Ltd continues to operate and denies all wrongdoing.
Ignatov was arrested at Los Angeles International Airport in March.
He signed a plea deal document on 4 October – but it was made public, on 12 November, only after being obtained by Inner City Press journalist Matthew Russell Lee.
By complying with the terms of the plea deal, Ignatov will not face further criminal charges for his role in OneCoin, other than any criminal tax violations that may emerge.
The document says Ignatov’s cooperation with the authorities may “reveal activities of individuals who might use violence” against him or his family.
It suggests he could apply to the US witness protection scheme and be assigned a new identity.
He has not yet been sentenced but faces up to 90 years in prison for his role in the fraud.
Ignatov has also been testifying in the trial of a US lawyer accused of laundering some of the proceeds from OneCoin.
Mark Scott is accused of routing approximately $400m (£310m) out of the US while trying to conceal the true ownership and source of the funds.
He faces one charge of conspiracy to commit money laundering and another to commit bank fraud. He has pleaded not guilty.
During that trial, Ignatov has revealed more details about the disappearance of his sister Dr. Ruja Ignatova.
According to his testimony, Dr. Ignatova was living in Sofia, Bulgaria before she vanished, the Inner City Press reports.
He confirmed that Dr. Ignatova had told him critics of OneCoin were “haters”, and that she was “very tired”.
She was afraid somebody close to her was going to give her up to the FBI, he said.
He claims she told him she had got hold of a “big passport” and asked him to get her plane tickets to Vienna, Austria and then Athens, Greece.
Ignatov said he had not spoken to his sister since she had disappeared. He had hired a private investigator to find her but had been unsuccessful.
The US government has said it expects Mr. Scott’s trial to conclude next week.
Analysis By Jamie Bartlett, The Missing Cryptoqueen presenter
Ignatov’s plea deal will come as a great relief to OneCoin’s critics.
Those who were threatened with legal action for calling OneCoin a scam will now feel vindicated.
Even though I have spent so long investigating this case, I was surprised to see the brother turn so dramatically against his sister.
Ignatov seems to be implying even he was duped by her.
There is nothing definitive about her whereabouts yet – but there are certainly some new leads to follow.
The case will slow down the continuing promotion of OneCoin – but it might not stop it entirely.
In the past, OneCoin promoters have dismissed all criticism and evidence as being politically motivated or coming from “haters”. They may do that again.
I believe the head office in Sofia remains open for business and I have already seen some supporters say they will continue to promote.
For lower-level investors, this might be a difficult time – as they will have to admit they have been duped and their money is gone.
That won’t be easy.
What is The Missing Cryptoqueen and who makes it?
The Missing Cyptoqueen is a BBC Sounds podcast launched in September 2019. Hosted by technology expert and author Jamie Bartlett, it’s co-written and produced by Georgia Catt. Jamie’s background is in writing about terrorist groups and their use of the internet. He also wrote a book in 2015 about The Dark Net – so knows plenty about the murkier corners of the web (in fact, here he is doing a TED Talk about it). Georgia Catt is a radio and podcast producer who’s worked with the likes of Jarvis Cocker in the past, and also on Radio 4 series The Untold. The Missing Cryptoqueen investigates the gripping real-life story of “cryptocurrency” OneCoin and the disappearance of its founder and figurehead Dr. Ruja Ignatova.
Right, so what’s the story with OneCoin?
Launched in 2014, OneCoin was the latest in a line of cryptocurrencies that promised to revolutionize the way we do banking online and make early investors rich. It branded itself “the Bitcoin killer”. Founded and led by Dr. Ruja Ignatova, a Bulgarian law Ph.D. graduate, and businesswoman, it grew quickly, often driven by hyperbolic public events. Like this one at Wembley Arena in London in 2016.
Ok, so you’ve got a bunch of people buying OneCoin, so what?
To cut a long story short, it was a scam. A fake. Fraud. A really big one. A multi-level marketing system with the same sort of structure as an old fashioned Pyramid scheme. You still can’t actively trade OneCoin like other cryptocurrencies. Thousands of people invested in OneCoin from more than 175 countries. The scale of it is mind-boggling: as part of their investigations, The Missing Cryptoqueen team uncovered data that suggested the total “investments” were worth up to £4 billion worldwide. It’s possibly the biggest cryptocurrency scam of all time. A lot of people have lost a lot of money. The podcast interviews victims of the scheme, including Jen McAdam who bought thousands of OneCoin and, like many others, urged her friends and family to do the same. She’s now a passionate activist for uncovering the truth about the company and bringing those responsible to justice.
Um, this story seems like kind of a big deal. Why haven’t I heard about it before?
A fair point. It’s been a story largely overlooked by mainstream media. Speaking to NME Jamie Bartlett offered an explanation: “I think a lot of mainstream journalists thought ‘oh, that’s a cryptocurrency story that’s for your crypto experts, I won’t touch that’ and the cryptocurrency journalists thought ‘that’s not really a cryptocurrency thing that’s a multi-level marketing scam, I won’t touch that’. It kind of fell through the gaps, which meant, amazingly, despite its size and its reach, no-one had really covered it.”
And what happened to Dr. Ruja?
Good question. No-one knows. Or rather, we don’t currently know. And that’s exactly what The Missing Cryptoqueen is attempting to resolve. Dr Ruja was due to board a plane in 2017 to attend a conference. She never arrived and has not been seen since. In the series, Jamie and Georgia pick through the story stage-by-stage in their attempt to track her down. It’s seen them travel all over: from Germany to meet workers at a factory Ruja once owned, to the wealthy suburbs of Amsterdam to speak to senior ex-OneCoin employees, like the larger-the-life Igor Alberts. Early in the series, they find themselves at a OneCoin event in Bucharest, Romania; a beauty pageant of sorts (Miss OneLife), where afterward they’re led to believe Dr. Ruja might have been in attendance.
Ok then – *SPOILER ALERT* – do they find her?
The final episode of the eight-part series was published on Monday 4 November 2019, and there was still no sign of Dr. Ruja. In an interview before it aired Jamie revealed to NME that much of that episode takes place in Uganda. “I think people are going to be quite surprised by what they hear and what we find,” he said. “But I don’t think the story is going to be quite over.”
It’s a difficult listen: the episode followed Jamie and Georgia’s journey to Uganda where they met Daniel, a OneCoin investor, who had convinced his mother (a farmer) to part with her savings instead of building a maze store to house her crops. They also visited a church where the preaching pastor was also a OneCoin team leader. One contributor told them they thought 50,000 people had pledged their cash to OneCoin in Uganda.
So there will be more podcasts?
Surely. The story isn’t finished. OneCoin is still operating. The series featured voices of salespeople and investors who’re still actively involved. The concluding episode (8) finishes with a tip-off from a contact, who wanted to remain anonymous, urging the team to continue searching for Ruja in Frankfurt, Germany.
As for OneCoin, after Ruja went missing, her brother led the company. Konstantin Ignatova was arrested in March 2019 for conspiracy to commit wire fraud. His trial is expected to take place in the U.S. before the end of 2019. Dr. Ruja Ignatova was also charged in absentia with money laundering. The trial of OneCoin lawyer Mark Scott has begun in America for his role in the “crypto-scam”.
What of OneCoin – do they have a response to all this?
Yes, believe it or not. The Missing Cyptoqueen team were putting their accusations to OneCoin throughout the making of the podcast. They reject all the allegations saying “OneCoin verifiably fulfills all criteria of the definition of a cryptocurrency”. Adding, “the series will not present any truthful information and cannot be considered objective, nor unbiased”. Riiight.
Source: NME Blog
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Thanks for reading “News – Following the OneCoin Crypto Fraud 2019 [Video]”
Dr. Don ICFO
Dr. Don Yates Sr Ph.D., Founder
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