The Bulgarian owner of the crypto exchange RG Coin was sentenced to 10 years of imprisonment. He was convicted on the charges of laundering money for Romanian gangs who were involved in online auction fraud via cryptocurrencies.
Name of the Culprit | Rossen G. Iossifov |
Age | 53 |
Country of Origin | Bulgaria |
Occupation | Owner of a Cryptocurrency Exchange |
Exchange Name | RG Coins |
Charges of Conviction | RICO Offense and Money Laundering |
Sentence Term | 10 – year imprisonment |
Known Associates | Foreign-based money launderers, AOAF Network |
The 53-year-old former Bulgarian national, owner of the bitcoin exchange RG Coin was sentenced to a lengthy prison term as he was involved in a multimillion-dollar scam in financial services. He used this Ponzi to defraud 100s of American citizens.
He was sentenced to 121 months of incarceration for this multimillion-dollar scheme by US District Court Judge Robert E. Weir.
He was convicted based on the following charges:
As per the evidence presented in the court at the time of trial, Iossifov was the owner and manager of the crypto exchange RG Coins, which was based in Sofia, Bulgaria.
He had full knowledge of all the ill-doings carried out via the exchange. He had bad intentions and willfully aided the criminals in laundering fraud proceeds.
He ran the operation using decentralized technologies in such a way that it would help him shield himself from criminal liability. At least five of his clientele were part of a known criminal network called Alexandria (Romania) Online Auction Fraud (AOAF) Network.
Referring to the court documents, we learn that this nexus of online auction fraud gang was part of a criminal conspiracy and executed a large-scale online auction Ponzi which victimized a minimum of 900 American citizens.
The partners in Romania used to falsely advertise on popular auction portals and sales sites such as eBay and Craigslist for high-cost goods and products, typically vehicles that didn’t exist in reality.
Some agents disguised themselves as the sellers of these vehicles. Now, this nefarious scheme would entrap the victims.
As the victims were convinced and sent the payment to these domestic agents, they immediately converted them to cryptocurrencies and then transferred the cryptocurrency proceeds to foreign counterparts in Romania. Iossifov was instrumental in executing the final step of the process.
Iossifov designed his entire business model to enable him to provide continuous support to the criminal enterprise involved in the crime.
He would offer lucrative flattering exchange rates TO AOAF Network members. He even allowed them to exchange cash against crypto without performing any KYC or proof of the source of those funds.
According to the evidence submitted during the trial, Iossifov laundered almost $5 million in crypto for only the AOAF Network scammers in 3 years.
A total of $7 million was stolen from the American victims. Iossifov made a hefty profit of $184,000 in commission from these thefts.
After a 2-week trial, Iossifov was convicted of 10 years and, per federal law, must serve 85% of his sentence.
Apart from him, 17 members of the AOAF Network were also convicted. Seven others were also convicted as part of the fraud.
Livui-Sorin Nedelcu was sentenced to 82-month imprisonment, Marius Dorin Cernat got 50 months, Stefan Alexandru Paiusi – 31 months, Eugen ALin Badea – 40 months,
Florin Arvat – 30 months, Alin Ionut Dobric – 37 months, and finally, Austin Edward Nedved, was sentenced to prison for 96 months. Out of all these convicted criminals, 3 are fugitives.
US Secret Service, Local Police Departments, IRS, and U.S. Postal Inspection Service were the leading conductors of this Investigation.
They got support from the US State Department and the Romanian authorities, including their organized crime task force. International agencies monitoring cross-border financial crimes were also involved in the case.
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This fraud was one of the most important crypto currency news, where the RG Gang leader was sentenced to jail for laundering millions of dollars.
Although crypto is considered the future of finance because of the public blockchain technology and various other decentralized applications, this incident has shocked the crypto market and jeopardized the future of cryptocurrency. It has made retail investors much more cautious before they carry out similar transactions.
It is always advisable to conduct thorough research about the crypto project as many blockchain companies are nothing, but rug pulls and scams in the blockchain space.
Disclaimer: The information provided in this article is for informational purposes only and should not be construed as financial advice. The author’s opinions are their own and should not be taken as a recommendation to invest in any particular product or service. It is strongly advised that you consult a financial advisor before making investment decisions. Investing always carries risk, and it is up to each individual to consider their options and make informed choices carefully.
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