Police in Estonia have arrested two men accused in a $575 million cryptocurrency fraud, U.S. Government said Monday.
An indictment unsealed in U.S. District Court in Seattle charged Estonian citizens Sergei Potapenko and Ivan Turogin, each age 37, with twine fraud and conspiracy to devote money laundering. Four different humans living in Estonia, Belarus and Switzerland have been also charged, but their identities have been no longer launched.
Prosecutors stated the suspects tricked hundreds of thousands of people from 2015 to 2019 into shopping for contracts for a cryptocurrency mining service called HashFlare and making an investment in a virtual foreign money financial institution called Polybius Bank. In truth the organizations operated as pyramid schemes, prosecutors said.
The guys are accused of using shell companies to launder the fraud proceeds and to purchase actual estate and comfort cars. The pair are in custody in Estonia pending extradition to the U.S., the Justice Department said.“These defendants capitalized on both the charm of cryptocurrency, and the mystery surrounding cryptocurrency mining, to devote an vast Ponzi scheme,” Seattle U.S. Attorney Nick Brown stated in a news release.
U.S. And Estonian government are operating to confiscate houses and bank money owed maintained with the aid of the defendants, Brown stated.Court records in Seattle did not suggest whether or not the men had received attorneys. Some of the sufferers have been in Western Washington country, government said.
The cryptocurrency enterprise has visible a honest share of volatility and turmoil this year, including a sharp decline in charge for bitcoin and other digital property. Earlier this month, the 1/3-largest cryptocurrency trade, FTX, collapsed after experiencing the crypto equal of a bank run. For some, the occasions are harking back to the disasters of Wall Street corporations all through the 2008 economic disaster, particularly now that supposedly wholesome corporations like FTX are failing.