Arrest warrant for $585 million crypto scam in Estonia. The United States Department of Justice has arrested two people in Estonia for allegedly defrauding several crypto companies worth $575 million. The profits could have been used to buy real estate and luxury cars. If convicted, the duo could face up to 20 years in prison.
The United States Department of Justice has arrested two Estonian nationals in Tallinn, Estonia, on charges of a multi-faceted scheme based on front companies using money to pay fraud. These 18 figures total $575 million.
Sergei Potapenko and Ivan Turõgin, both 37, set up a contract to borrow fake equipment for a crypto mining project called HashFlare and tricked victims into investing in a fake crypto bank called Polybius Bank that did not pay customers. Hundreds of thousands of people fell into these schemes, according to court documents.
Crypto scam in Estonia
HashFlare was in operation between 2015 and 2019 and raised $550 million in revenue. Apparently the mining equipment is mining bitcoin with less than 1% of the computing power it claims to have. Polybius was established in 2017 and raised $25 million, which was sent to other bank accounts and crypto wallets of the defendants. “They tried to hide their ill-gotten gains in Estonian homes, luxury cars, bank accounts and virtual wallets around the world,” Assistant Attorney General Kenneth A. Polite, Jr. said the criminal division of the Department of Justice. “The authorities in the United States and Estonia are working to seize and hold these assets and profit from these crimes.”
The money laundering scheme includes 75 properties, six luxury cars and thousands of cryptocurrency mining machines, the statement said.
Turõgin and Potapenko were arrested on November 2. 20 and charged with “conspiracy to commit wire fraud, 16 counts of wire fraud and one count of conspiracy to commit money laundering,” the Justice Department said.
The case is currently being investigated by the FBI. If convicted, the duo could face up to 20 years in prison. That will be up to a federal district judge to decide. Crypto scam in Estonia.
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