The co-founder of the huge pyramid scheme known as OneCoin, a bogus cryptocurrency that duped millions of investors worldwide out of more than $4 billion, was given a 20-year prison sentence on Tuesday.
In December, Karl Greenwood, 46, admitted guilt to charges of wire fraud and money laundering. Greenwood was the mastermind behind the multibillion dollar multilevel marketing scam.
The FBI’s Top 10 Most Wanted list “Cryptoqueen” and his partner Ruja Ignatova, 43, are still at large, according to the U.S. Department of Justice.
According to a news statement from U.S. Attorney Damian Williams, Greenwood ran one of the biggest fraud schemes ever.
Williams stated, they hope this long sentence resonates in the financial sector and dissuades anyone who may be tempted to deceive investors and take advantage of the cryptocurrency ecosystem through fraud.
In lower Manhattan’s U.S. District Court, Greenwood was sentenced by federal Judge Edgardo Ramos.
The DOJ reported that between 2014 and 2016, OneCoin, which started in Bulgaria in 2014, received more than $4 billion from at least 3.5 million users. The multilevel marketing system used to promote and sell the scheme provided commission to OneCoin members who brought in new customers to purchase cryptocurrency packages.
The largest distributor, Greenwood, earned 5% of all OneCoin sales and made more than $300 million in total, according to the DOJ.
OneCoin was continuously touted by Greenwood and Ignatova as the upcoming Bitcoin-like cryptocurrency investment opportunity. But unlike trustworthy cryptocurrencies, OneCoin had no real value and was designed from the start by Greenwood and Ignatova as a scam, the DOJ claimed.
Authorities said that the co-founders and others deceived investors on numerous occasions, including by representing OneCoin’s price as being set arbitrarily while in fact it was determined by market forces.
Ignatova was charged with fraud and money laundering in October 2017. Ignatova flew from Bulgaria to Athens, Greece, a few days after a federal arrest notice was issued for her.
She hasn’t been spotted in public since, according to the DOJ.
Ignatova’s listing on the FBI’s Top 10 Most Wanted Fugitives list states that the agency is offering a reward of up to $250,000 for information that results in her capture.
She may have undergone plastic surgery or otherwise changed her appearance, according to the wanted poster, and is believed to travel with armed guards and/or associates.
