$4bn OneCoin scammer faces 60 years in jail
US Department of Justice says Karl Greenwood deliberately lied ‘to line his own pockets to the tune of hundreds of millions of dollars’
A conspirator in one of the largest scams in cryptocurrency history, Karl Sebastian Greenwood, who co-created OneCoin, has pleaded guilty in New York to charges of fraud and money laundering, and now faces up to 60 years in prison.
In a statement, the United States Department of Justice said that the global public invested more than $4bn into the fraudulent project as a result of the misrepresentations made by Greenwood and his accomplices.
Instead of being a multi-level-marketing scheme with an associated cryptocurrency, OneCoin was both a pyramid and a Ponzi scheme. Investors would recruit others into the scheme and later investors were paid with the money from earlier investors.
US Attorney Damian Williams described OneCoin as “one of the largest international fraud schemes ever perpetrated”. He said: “Greenwood’s lies were designed with one goal, to get everyday people all over the world to part with their hard-earned money — real money — and to line his own pockets to the tune of hundreds of millions of dollars."
"This guilty plea by the co-founder of OneCoin caps a week at SDNY [Southern District of New York] that sends a clear message that we are coming after all those who seek to exploit the cryptocurrency ecosystem through fraud, no matter how big or sophisticated you are.”
Accomplice remains on the run
Greenwood, who holds both British and Swedish citizenship, is thought to have earned around $21.2m a month as OneCoin’s “global master distributor”.
He was arrested in Thailand and extradited to the United States in 2018. Four years later, he pleaded guilty to one count of conspiracy to commit wire fraud, one count of wire fraud and one count of conspiracy to commit money laundering. All three charges carry maximum sentences of 20 years.
The DOJ renewedits call for information about the whereabouts of Greenwood’s accomplice, Ruja Ignatova. The Bulgarian was placed on the FBI’s Top Ten Most Wanted list earlier this year.
