A Multibillion-Dollar Cryptocurrency Based on ‘Lies’: US Arrests Alleged OneCoin Leader

U.S. prosecutors in New York have arrested a “top leader” of the OneCoin project, saying “billions” have been stolen through the alleged pyramid scheme.

The Southern District of New York (SDNY) has indicted Ruja Ignatova and Konstantin Ignatov on charges of wire fraud, securities fraud and money laundering, claiming the two defrauded investors out of “billions of dollars” using a fraudulent cryptocurrency. Ignatov was arrested on wire fraud charges at Los Angeles International Airport earlier this week as part of the investigation.

According to a press release, prosecutors are alleging that OneCoin is a pyramid scheme, where members receive commissions to recruit other individuals to the project. These recruits are required to purchase crypto packages, and OneCoin currently claims to have 3 million members worldwide.

While OneCoin claims its tokens are mined by servers operated by the company and that its price growth is organic, neither of these are true, the release says.

Further, Ignatova allegedly said in an email that she has an “exit strategy” from the company.

Noting that these charges are allegations at the moment, SDNY U.S. Attorney Geoffrey Berman said “these defendants created a multibillion-dollar ‘cryptocurrency’ company based completely on lies and deceit,” adding:

“They promised big returns and minimal risk, but, as alleged, this business was a pyramid scheme based on smoke and mirrors more than zeroes and ones. Investors were victimized while the defendants got rich.”

While Ignatov has been arrested, Ignatova remains at large. Another defendant, Mark Scott, was arrested last year in Massachusetts.

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Source: Coindesk