Headlines that matter for companies and executives in regulated industries
Co-founder of fraudulent cryptocurrency sentenced to 20 years in prison
Karl Sebastian Greenwood, a citizen of Sweden and the United Kingdom and co-founder of the OneCoin cryptocurrency, was sentenced to 20 years in prison for his alleged role in a $4 billion fraud scheme. As described by prosecutors, OneCoin began operating in Bulgaria in 2014 and sold a fraudulent cryptocurrency with the same name through a multi-level marketing (MLM) scheme. Around 2015, OneCoin began operating in the United States.
The government accused Greenwood and others of making various misrepresentations about OneCoin to secure more than $4 billion in investments from approximately 3.5 million investors. These alleged misrepresentations include the claim that the value of OneCoin was based on market supply and demand, although in reality the value was set arbitrarily without regard to market forces. Greenwood also claimed to have a private blockchain to identify OneCoins and record historical transactions, when in reality no verifiable public blockchain existed.
According to the government, OneCoin marketed its cryptocurrency through a global MLM network through which OneCoin members would receive commissions for recruiting others to purchase bundles of cryptocurrency. As OneCoin's top MLM distributor, Greenwood is alleged to have earned 5% of OneCoin's monthly sales, totaling over $300 million. In addition to his 20-year prison sentence, Greenwood was ordered to pay approximately $300,000 in forfeiture. OneCoin's other co-founder, Ruja Ignatova, remains at large and was added to the FBI's ten most wanted list in June 2022.
You can find a link to the US Department of Justice (DOJ) press release here.
Inmate pleads guilty to COVID-19 aid fraud
Telvin Breaux, a California prison inmate, and three other co-defendants pleaded guilty to conspiracy and aggravated identity theft for their alleged roles in a $25 million unemployment benefits scheme. According to the Department of Justice, Breaux and his co-defendants obtained personally identifiable information from other inmates, as well as patients and customers at hospitals, dentist offices and other businesses where one of the co-defendants worked or had connections. Breaux and his co-defendants used this information to submit fraudulent unemployment insurance claims to the California Employment Development Department (EDD). In connection with these false claims, Breaux and his co-defendants also made specific false statements that the people whose information they stole were unable to work as a result of the COVID-19 pandemic.
In total, the defendants are alleged to have submitted more than 400 fraudulent claims totaling more than $25 million to the EDD, $5.4 million of which was actually paid and used by the defendants to purchase luxury vehicles, finance trips to Las Vegas and pay rent and tuition. . Each defendant faces a maximum of 22 years in prison and $250,000 in fines.
You can find a link to the DOJ press release here.
Former CFO of New York City Nonprofit Sentenced to 18 Months in Prison
Donna Murray, the former chief financial officer of a New York City-based nonprofit financial services trade association with more than 600 members, was sentenced to 18 months in prison for allegedly embezzling nearly half a million dollars. of the non-profit organization. The government alleges that Murray was the sole employee of the nonprofit's finance department and was responsible for maintaining the organization's books and records, handling accounts receivable and payable, and managing financial statements for outside auditors. . Additionally, it is alleged that Murray was the only employee with the ability to make wire transfers for the organization.
As detailed in the Department of Justice information, Murray was accused of a months-long embezzlement scheme in which she stole more than $488,000 from the organization's bank accounts through 105 unauthorized wire transfers to her account. staff. Murray covered up the scheme by creating false entries in the organization's general ledger and transferring less than $10,000 in each transaction to avoid triggering bank reporting requirements. Prosecutors accused Murray of using the embezzled funds to pay off personal loans and purchase luxury items. For her conduct, Murray was sentenced to 18 months in prison.
You can find a link to the DOJ press release here.
[View source.]
