Russian Police Arrests Founder of Crypto Ponzi with 300+ Victims

Wilfred Michael 

Wilfred Michael

News reporter

29 May 2019,
Russian Police Arrests Founder of Crypto Ponzi with 300+ Victims

Russia’s Ministry of Internal Affairs (MOI) reported on May 28 that it closely worked with authorities in Kazakhstan to arrest the founder of a cryptocurrency-related Ponzi scheme that defrauded at least 300 investors.

As per the report, the unnamed man is a Kazakhstan citizen and pooled money from investors by designing a crypto Ponzi scheme that promised unusually high returns. One of his victims had put in as much as 14 million Kazakhstan Tenge ($36,700) with several other people filing reports that they also lost money to the scheme.

Meanwhile, the alleged criminal fled Kazakhstan at the start of 2019 and was declared subsequently wanted by both local authorities and the Interpol before his arrest in Russia earlier this week.

The Russian MOI is now reviewing possible extradition of the criminal back to Kazakhstan after he confessed upon his arrest that he made it into Russia on horseback after he fled his home country.

The latest report from Russia continues a round of successful effort by enforcement agencies around the world to hunt down crypto fraudsters.

Last week, we reported that the Dutch Fiscal Information and Investigation Service (FIOD), Europol, and enforcement agencies in Luxembourg successfully shut down cryptocurrency mixing service provider,

Before the shutdown, had helped its clients that are mostly criminals and money launders to obfuscate up to 27,000 Bitcoins.

In another cryptocurrency-related crime incident, the United States Securities and Exchanges Commission (SEC) obtained a court order to halt the operations of Argyle Coin LLC because its owner is operating a $30 million Ponzi scheme.