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Title: Co-Founder of Onecoin, Karl Sebastian Greenwood, Receives 20-Year Prison Sentence
Karl Sebastian Greenwood, a co-founder of the cryptocurrency pyramid scheme Onecoin and a dual British and Swedish citizen, has been handed a lengthy 20-year prison sentence in the United States. His conviction stems from his pivotal role in orchestrating the fraudulent multi-level marketing structure at the heart of Onecoin’s operations.
This substantial sentence was delivered by U.S. District Judge Edgardo Ramos and was officially announced by Damian Williams, the United States Attorney for the Southern District of New York.
Greenwood co-established Onecoin, an organization headquartered in Sofia, Bulgaria, which commenced operations in 2014. His partner in this dubious venture was Ruja Ignatova, a Bulgarian-born German national, colloquially referred to as the “missing Cryptoqueen,” as she remains evasive to authorities. Under their leadership, Onecoin embarked on a global multi-level marketing (MLM) campaign to promote and distribute a fictitious cryptocurrency bearing the same name.
The repercussions of their deceitful actions were profound, with a staggering 3.5 million individuals worldwide, including U.S. citizens, falling victim to their scheme. Astonishingly, between the final quarters of 2014 and 2016, these victims collectively invested a staggering $4 billion into the fraudulent enterprise. Greenwood, who held the role of Onecoin’s global master distributor and presided over the MLM network, accrued significant wealth, reportedly amassing around $300 million. This sum was subsequently subjected to forfeiture in addition to his prison term, according to an official press release.
U.S. Attorney Damian Williams remarked, “As a founder and leader of Onecoin, Karl Sebastian Greenwood operated one of the largest fraud schemes ever perpetrated. Greenwood and his co-conspirators, including fugitive Ruja Ignatova, conned unsuspecting victims out of billions of dollars with promises of a ‘financial revolution’ and claims that Onecoin would be the ‘Bitcoin killer.'”
Contrary to their claims, the cryptocurrency issued by Onecoin held no real value, with its worth being arbitrarily determined by the fraudsters themselves. Onecoin deceitfully asserted that their tokens were mined similarly to legitimate cryptocurrencies, and they even propagated the notion that their transactions were recorded on a private blockchain. Williams expressed hope that the severity of Greenwood’s sentence would serve as a cautionary tale within the financial sector, deterring anyone tempted to exploit the cryptocurrency ecosystem through fraudulent means.
Karl Sebastian Greenwood’s arrest took place in July 2018 at his residence on the Thai island of Koh Samui. He was subsequently extradited to the United States in October of the same year to face charges of fraud and money laundering. In December 2022, Greenwood pleaded guilty to wire fraud and money laundering charges in a Manhattan federal court.
Meanwhile, Onecoin’s mastermind, Ruja Ignatova, remains a fugitive sought by Interpol, Europol, and the U.S. Federal Bureau of Investigation (FBI). Her last known sighting occurred on October 25, 2017, when she boarded a flight from Sofia to Athens. Various reports have sporadically surfaced, citing unverified information about her possible whereabouts. According to one such report, she met an unfortunate fate in Greece, one year after her disappearance.
In a related development, Konstantin Ignatov, Ruja’s brother and another co-founder of Onecoin, was arrested in Los Angeles in 2019. He subsequently pleaded guilty to charges related to Onecoin and sought witness protection within the United States. Additionally, Gilbert Armenta, a former boyfriend of the Cryptoqueen, received a five-year prison sentence in February 2023 for his role in laundering $300 million of Onecoin’s ill-gotten gains.
The question of whether Ruja Ignatova, the remaining co-founder of Onecoin, will face justice remains unanswered. We invite you to share your thoughts on this matter in the comments section below.
Frequently Asked Questions (FAQs) about Crypto Fraud Sentencing
Q: Who is Karl Sebastian Greenwood, and why was he sentenced to 20 years in prison?
A: Karl Sebastian Greenwood is one of the co-founders of the cryptocurrency pyramid scheme Onecoin. He was sentenced to 20 years in prison for his significant role in orchestrating and leading Onecoin’s fraudulent multi-level marketing (MLM) structure, which defrauded millions of individuals worldwide.
Q: What was Onecoin, and how did it operate?
A: Onecoin was a fraudulent cryptocurrency scheme established in 2014 by Karl Greenwood and Ruja Ignatova. It operated through a global MLM network, claiming to offer a new and revolutionary digital currency. However, in reality, Onecoin’s tokens were worthless, and the scheme relied on deceptive marketing and misrepresentations to attract investors.
Q: How much money did victims invest in Onecoin, and how many people were affected?
A: Victims of Onecoin invested a staggering $4 billion between the fourth quarter of 2014 and the fourth quarter of 2016 alone. Approximately 3.5 million individuals worldwide, including those in the United States, fell victim to this massive fraudulent scheme.
Q: What role did Karl Greenwood play in Onecoin, and what were his earnings?
A: Karl Greenwood served as Onecoin’s global master distributor and was a key leader in the MLM network. He earned substantial income, reportedly around $300 million, largely from receiving 5% of the monthly sales. However, these earnings were ultimately subjected to forfeiture as part of his sentencing.
Q: Has Ruja Ignatova, the other co-founder of Onecoin, been apprehended?
A: No, Ruja Ignatova, often referred to as the “Cryptoqueen,” remains a fugitive and has not been apprehended. She is wanted by Interpol, Europol, and the FBI for her role in the Onecoin scheme.
Q: What were the false claims made by Onecoin, and how were they debunked?
A: Onecoin made several false claims, including that their tokens were mined like legitimate cryptocurrencies and that their transactions were recorded on a private blockchain. These claims were debunked as the cryptocurrency had no real value, and its worth was manipulated by the fraudsters themselves.
Q: When and where was Karl Sebastian Greenwood arrested, and what were the charges against him?
A: Karl Sebastian Greenwood was arrested in July 2018 at his residence on the Thai island of Koh Samui. He was subsequently extradited to the United States in October of the same year. He faced charges of wire fraud and money laundering, to which he pleaded guilty in December 2022 in a Manhattan federal court.
Q: What happened to other individuals associated with Onecoin, such as Konstantin Ignatov and Gilbert Armenta?
A: Konstantin Ignatov, Ruja Ignatova’s brother and another co-founder of Onecoin, was arrested in Los Angeles in 2019. He pleaded guilty to Onecoin-related charges and sought witness protection in the United States. Gilbert Armenta, Ruja’s former boyfriend, was sentenced to five years in prison in February 2023 for his involvement in laundering $300 million of Onecoin proceeds.
Q: Is there any information on the whereabouts of Ruja Ignatova?
A: Ruja Ignatova’s whereabouts remain unknown, and she is still wanted by law enforcement agencies such as Interpol, Europol, and the FBI. Her last known sighting was on October 25, 2017, when she boarded a flight from Sofia to Athens. Various unverified reports have surfaced regarding her potential fate, including one suggesting her demise in Greece a year after her disappearance.
More about Crypto Fraud Sentencing
- Onecoin Co-founder Sentenced to 20 Years
- Onecoin: The Cryptocurrency Scam
- Onecoin’s Fraudulent MLM Operation
- Ruja Ignatova: The Missing Cryptoqueen
- Konstantin Ignatov’s Arrest and Plea
- Gilbert Armenta’s Sentencing