Karl Sebastian Greenwood pleaded guilty on December 16, 2022, to operating a multi-billion cryptocurrency pyramid scheme dubbed OneCoin.
In a bid to send a strong message to the cryptocurrency community around the world, Damian Williams, the United States Attorney for the southern district of New York, announced on Tuesday that Karl Sebastian Greenwood, a co-founder of the OneCoin project with Ruja Ignatova (cryptoqueen), has been sentenced to a 20-year prison term. According to the announcement, the sentencing was issued by US District Judge Edgardo Ramos.
Notably, Greenwood is said to have led the OneCoin global marketing structure dubbed MLM network that accrued approximately $300 million for him by 2016. Moreover, Greenwood earned about 5 percent of monthly OneCoin sales from anywhere in the world. Reportedly, the OneCoin crypto project duped nearly 3.5 million investors from around the world and stole over $4 billion.
“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.’ In fact, OneCoins were entirely worthless, and investors were left with nothing,” Williams noted.
Notably, Greenwood was arrested at his residence on the island of Koh Samui, Thailand, in July 2018 and was extradited to the United States to face fraud and money laundering charges in October 2018.
OneCoin Co-founder Greenwood Misuses Investors’ Money
According to the announcement, Greenwood used investors’ money to book luxury hotels all over the world and purchase expensive properties. For instance, Greenwood stayed in a five-star resort in Brazil and used about $10k back in December 2015. Later the same month, Greenwood used about $21k of fraud proceeds to stay at a luxury villa with a beach view in Koh Samui, Thailand. In early 2016, Greenwood went to Barcelona and stayed in a luxury five-star hotel in addition to renting a Range Rover during the same period.
Reportedly, Greenwood purchased designer clothes, shoes, and watches worth approximately $2 million. He is also believed to have paid a down payment of about $475k for a yacht. The announcement further noted that Greenwood had purchased various real estate in different countries including Dubai, Spain, and Thailand.
As a result, the court ordered Greenwood to pay approximately $300 million in forfeiture in addition to the 20-year prison sentence.
Closer Look at the OneCoin Project
The OneCoin project attracted most investors for promising hefty profits. Moreover, the OneCoin gained in price from about €0.5 to approximately €29.95 in less than five years. Founded in Sofia, Bulgaria back in 2014, the OneCoin project has been described as one of the largest pyramid schemes in the cryptocurrency market. Notably, the FBI has listed the cryptoqueen on the most wanted list and issued a $250k reward for any information that may lead to her arrest.
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