Home Crypto Two Estonian citizens arrested in $575 mln cryptocurrency fraud, money laundering scheme

Two Estonian citizens arrested in $575 mln cryptocurrency fraud, money laundering scheme

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WASHINGTON (Reuters) – Two Estonians have been arrested in Tallinn, Estonia, on suspicion of being involved in a $575 million cryptocurrency fraud and money laundering conspiracy, the U.S. Department of Justice said on Thursday. .

Sergei Potapenko and Ivan Turõgin, both 37, are accused of using a multifaceted scheme to trick hundreds of thousands of victims into signing illicit equipment rental agreements with the defendants’ cryptocurrency mining service HashFlare. I’m here.

According to the Justice Department, victims were forced to invest in a cryptocurrency bank, Polybius Bank, which was not really a bank and never paid the dividends promised.

Victims paid more than $575 million to Potapenko and Turõgin companies, who then used shell firms to launder the proceeds of the fraud to purchase real estate and luxury cars, the agency said.

The indictment was remanded by a grand jury for the Western District of Washington on Oct. 27 and opened Monday.

Representatives for Potapenko and Turogin were not immediately available for comment.

“The scale and scope of the alleged scheme is truly staggering,” said Kenneth Polite, Jr., Assistant Attorney General for the Department of Justice’s Criminal Division. We are working to profit from the crimes of

According to the ministry, the money laundering conspiracy allegedly involved at least 75 properties, six luxury cars, a cryptocurrency wallet and thousands of cryptocurrency mining machines. investigated.

Reporting by Kanishka Singh, Washington Editing by Bernadette Baum

Our criteria: Thomson Reuters Trust Principles.

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