For those with a history in the cryptocurrency space, memories of the elaborate OneCoin scam still linger. Recently, a semblance of justice was served as one of the fraudulent project’s co-founders was handed a 20-year prison sentence.
Karl Greenwood, a co-founder of OneCoin, received his sentence in the United States on September 20. Alongside his prison term, he was ordered to pay a staggering $300 million in restitution.
Read Also: CoinEx Suspends Transactions After $27M Hack
Karl Greenwood Receives Prison Sentence
Greenwood’s sentencing took place in the United States District Court for the Southern District of New York, where the U.S. Attorney, Damian Williams, labeled OneCoin as “one of the largest fraud schemes ever perpetrated.”
The gravity of the situation became apparent when Greenwood was sentenced to two decades behind bars for orchestrating the colossal cryptocurrency scam that swindled millions of investors out of more than $4 billion on a global scale. It’s worth noting that Greenwood has been in custody since 2018 when he was extradited from Thailand.
In December, Greenwood pleaded guilty to charges of fraud and money laundering. He could have faced a maximum sentence of 60 years, according to reports.
Greenwood’s personal gains from the fraudulent scheme were estimated at over $300 million, earned through a 5% commission on all OneCoin sales. He lived a lavish lifestyle, indulging in designer clothing, expensive watches, overseas properties, and even a luxury yacht.
This recent development follows earlier legal actions against individuals associated with OneCoin. In March, the former head of legal and compliance for OneCoin, Irina Dilkinska, was charged in the United States with wire fraud and conspiracy to commit money laundering. Furthermore, in August 2022, Christopher Hamilton, an associate of the scheme, faced extradition to the United States on charges of fraud and money laundering.
Read Also: Consensys Announces Public Launch of MetaMask Snaps
The OneCoin Scheme Unveiled
The OneCoin scam itself was a multilevel marketing and Ponzi scheme that generated staggering sales revenue of €4.037 billion between the fourth quarter of 2014 and the fourth quarter of 2016, with profits amounting to €2.735 billion. Despite its global marketing efforts, most of its victims were Americans.
In stark contrast to legitimate cryptocurrencies, OneCoin had no intrinsic value. While the OneCoin team likened its product to Bitcoin in promotional campaigns, it lacked a genuine blockchain. OneCoin neither mined coins nor had a functional blockchain; instead, it fabricated fake valuations that only increased over time. Yet, it successfully persuaded investors that they were entering the next Bitcoin gold rush.
Investors were duped by the hype that compared OneCoin to Bitcoin and falsely claimed it could surpass the pioneering cryptocurrency, despite lacking any real trading, mining, or verification processes.
The scheme’s co-founder, Ruja Ignatova, Karl Greenwood, and their accomplices portrayed OneCoin as a legitimate Bitcoin alternative, even though it was devoid of value from the outset.
Ruja Ignatova, known as the “Cryptoqueen,” vanished in 2017 after the United States indicted her on charges of fraud and money laundering. She had been the public face of OneCoin, vigorously promoting the scam through ostentatious marketing events and hype-building. Today, the FBI includes her on their most-wanted list, offering a $100,000 reward for information leading to her arrest.
Earlier this year, rumors circulated suggesting that the fugitive had met her demise in Greece five years ago, adding another layer of intrigue to the ongoing saga of the OneCoin scam.
Follow techkudi.com for more juicy content
