A $40 million fund has been established from seized assets for victims of the $4 billion OneCoin fraud scheme, as announced by the US Department of Justice. The scheme, which operated between 2014 and 2019, involved co-founders Ignatova and Karl Sebastian Greenwood deceiving up to 3.4 million investors worldwide.
OneCoin, based in Sofia, Bulgaria, used a global multi-level marketing network to sell a fake cryptocurrency. Investors globally lost over $4 billion in the scheme, which was found to be a ponzi scheme that collapsed in 2017.
The Department of Justice has described it as 'one of the largest global fraud schemes in history'. In 2022, Greenwood admitted to federal wire fraud and money laundering charges. The US Attorney for the Southern District of New York stated that the founders 'sold a lie disguised as cryptocurrency', resulting in losses of over $4 billion worldwide.
The DOJ will continue to seize assets and prioritize returning money to victims. This development comes after the FTX Recovery Trust announced a $2.2 billion distribution to creditors, as part of its efforts to recover assets for users of the collapsed crypto trading platform.