Victor Ugochukwu · Oct 30, 2020 . 8min read
Bulgarian Crypto Exchange founder RG Coins sentenced for online auction fraud
The founder of RG Coins is found guilty of crypto online auction fraud in an international cyber fraud scheme to defraud Americans.
By Komal Joshi · Sep 29, 2020 . 7min read
The owner of Bulgarian cryptocurrency exchange R.G. Coins, Rossen Iossifov, was found guilty for crypto money laundering on Monday. He involved himself in a multi-million dollar scheme to deceive American victims via online auction fraud, according to a Department of Justice release. After conducting the trial for two weeks, Iossifov was charged guilty. He was accountable for orchestrating a convoluted scheme to swindle money from innocent victims in America. He is also responsible for committing racketeering and money laundering with cryptocurrency. Moreover, he will face sentencing on Jan 12, 2021.
R.G. Coins is an exchange selling hardware wallets and facilitating cryptocurrency exchange for the Eastern European region. The founder of the small-scale Bulgarian exchange attracted the U.S. investigators’ focus last year owing to suspicions that he supported a Romanian money laundering gang. The court documents elucidate that Iossifov and his co-conspirators defrauded at least 900 Americans via phishing attacks between 2014-2015. They put up fake advertisements to online auction and sales websites, like Craigslist and eBay, for high-cost goods that did not exist.
Members of RG Coin money laundering attempted to make the whole process look legal.
According to the court documents, they also delivered invoices to the victims, showing reputable companies’ trademarks to make the transaction seem legal. Members of the conspiracy also established call centres, representing consumer support, to address questions and mitigate concerns over the advertisements. They would convince American victims to send money for the advertised goods by crafting persuasive narratives.
Members of the conspiracy, the 14 Romania citizens, would convert the proceeds they received. They then employed R.G. Coins to launder the stolen money by buying Bitcoin. The R.G. Coins founder declares that he was not conscious about the Romanian implication in criminal activities. He says that he was unaware of the usage of their services for laundering the proceeds.
He was then deported to the U.S. in 2019 for further investigation in overseas where the trial took place. Romania extradited almost one dozen of the defendants, with Iossifov being the 17th defendant. The other three defendants are fugitives. Nevertheless, the U.S. authorities stated he was aware of the purpose of the Romanian fraudsters’ transactions. However, R.G. Coins had a limitation of 5 bitcoin for unidentified orders. Thus, Iossifov exchanged over $4.9 million worth of Bitcoin for just four other criminal enterprise members. He did not implement KYC authentication procedures for these transactions.
The R.G. Coins case relates to the earlier arrest of Vlad Nistor, CEO of Coinflux, a top crypto exchange operating in Romania. U.S. authorities trialled him after evidence presented to a local court. The document connected him to the same group of 14 named Romanians.
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Komal Joshi · Oct 30, 2020 . 5min read