Perpetrators of OneCoin Crypto Fraud Worth IDR 62.3 Trillion Sentenced to 60 Years in Prison

OneCoin co-founder and Ruja Ignatova partner, Karl Sebastian Greenwood. (Photo; Doc. Bitcoin Buzz)

JAKARTA – OneCoin crypto company co-founder, Karl Sebastian Greenwood pleaded guilty to charges of fraud and money laundering. Greenwood is an associate of Ruja Ignatova aka CryptoQueen who is currently at large.

OneCoin is a crypto company founded by Ignatova and Greenwood in 2014 in Bulgaria. The company also sells OneCoin tokens to the public. OneCoin is being heralded as a “Bitcoin killer” by both of them.

In fact, this effort is one way to carry out fraudulent actions in the crypto market. Greenwood recently pleaded guilty to financial crimes and money laundering. The US Department of Justice (DOJ) sentenced him to a maximum of 60 years in prison.

Through its official website, the DOJ said "OneCoin is a crypto scam that is marketed and sold to millions of victims around the world, resulting in billions of dollars in losses."

The DOJ announced on December 16 that Greenwood pleaded guilty in Manhattan federal court on charges of fraudulent scheme, conspiracy to commit fraud, and conspiracy to launder money with each count carrying a potential maximum sentence of 20 years in prison.

US Attorney Damian Williams said Greenwood operated "one of the largest international fraud schemes ever undertaken" and claimed that he was touting OneCoin as a "Bitcoin killer" when in reality the token is "absolutely worthless," reported Cointelegraph.

OneCoin claims to use a multi-level marketing or MLM mechanism. Apart from that, they also announced that users can mine more tokens. At that time, OneCoin tokens could only be exchanged for money on the private Xcoinx exchange.

In fact, the actions taken by OneCoin are a pyramid scheme and a Ponzi scheme. This is because investors can recruit other people without receiving the actual product, the OneCoin token. They are only paid using money from investors who first entered the fraudulent scheme.

According to the DOJ, Greenwood was making around 21.2 million US dollars (or 20 million euros) per month in his role as a "global top distributor" of the crypto company that carried out the scam. OneCoin allegedly succeeded in obtaining funds of USD 4 billion (equivalent to IDR 62.3 trillion) from its victims, which numbered around three million investors.

Even though Greenwood admits his guilt, his partner, Ruja Ignatova is still at large. The FBI has put Ignatova in its top 10 wanted list. The reason is that the CryptoQueen has a central role in this fraudulent action. Ignatova was last known to have traveled to Athens, Greece in 2017. Until now, her whereabouts are unknown.

The plan is for Greenwood to be sentenced to prison on April 5, 2023, before District Judge Edgardo Ramos. Until now, the authorities continue to hunt down the perpetrators of cryptocurrency fraud.