The number one rule for any mastermind behind a Ponzi scheme is not to get caught and jailed by the authorities. Apparently, Konstantin Ignatov didn’t follow that rule to the word as he was made to plead guilty to a host of charges related to financial fraud and money laundering. He admitted to committing these acts of misdeed as a part of the infamous Ponzi scheme that was masterfully camouflaged as a cryptocurrency exchange named OneCoin.
Earlier this year, Ignatov was arrested at the Los Angeles International Airport, when he was trying to flee the country, and prosecuted by the United States Department of Justice. The two sides had ultimately reached a plea deal, within the framework of which Ignatov has admitted his direct involvement in one of the biggest ICO frauds of all time, the victims of which got bamboozled out of $4 billion. The deal also stipulates that Ignatov can spend up to 90 years in prison, though the precise sentence term will be decided later.
The sentencing of Konstantin Ignatov will not come as a closing chapter of the OneCoin story since he was not the only founder of the eponymous limited company, as well as another offshore company OneLife Network Ltd, which were operating out of Dubai and Belize, respectively.
Whom the authorities are really looking for is Ruja Ignatova, also known as the “crypto queen,” who had actually founded both companies and acted as the main beneficiary of this Ponzi scheme. As you could have guessed, Konstantin is the brother of the Bulgarian con artist, who still remains in flight from the law.
Nevertheless, the family ties did not stop Ignatov from testifying against his sister and providing the Department with vital information about Ruja’s possible whereabouts. Supposedly, Ignatova has been laying low in either Austria or Greece as she had managed to obtain a fake ID and get on a flight to one of these counties. Konstantin even claimed that he had hired a private detective that had to locate his sister. Unfortunately, all previous efforts were to no avail.
The captured fraudster has also fed the authorities comprehensive information about Mark Scott, a co-conspirator who had used the corporate account at the Bank of Ireland to launder more than $400 million, obtained through OneCoin.
The Ignatov siblings have designed a scheme through which they had been selling trading courses, some of which were priced at over $200 thousand. By purchasing these courses, the gullible traders were also given the right to “mine” the cryptocurrency named OneCoin.
However, the gist of the scheme is that all mined OneCoins could have been converted to other cryptocurrencies only by a means of the OneCoin exchange, which was an internal platform for the holders of educational packages. In 2016, the exchange had been closed for “maintenance,” then went back up for a short period of time, before being shut down for good in January 2017. Before that, the Bulgarian Financial Supervision Committee, the Italian Antitrust Authority, the Hungarian Central Bank, and the Croatian National Bank had issued repeated warnings about OneCoin being a Ponzi scheme. Ruja Ignatova is now wanted by the authorities of India, Bulgaria, Belize, as well as the FBI and Europol.
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