A $40 million compensation fund, comprising seized assets, has been made available for victims of the $4 billion OneCoin cryptocurrency scam, as announced by the US Department of Justice. The scheme, which operated from 2014 to 2019, was perpetrated by OneCoin Ltd.
co-founders Ignatova and Karl Sebastian Greenwood, and involved the sale of a fraudulent cryptocurrency through a global multi-level marketing network. Approximately 3.4 million investors worldwide were defrauded, with total investments exceeding $4 billion. The scheme, which did not involve actual cryptocurrencies or blockchain technology, was deemed one of the largest global fraud schemes in history.
Following its collapse in 2017, the DOJ has been working to seize assets and secure compensation for victims. In a statement, US Attorney Jay Clayton emphasized the DOJ's commitment to recovering proceeds and reimbursing victims, stating that OneCoin's founders had sold a false promise disguised as a cryptocurrency, resulting in losses of over $4 billion worldwide. The compensation process comes as part of the DOJ's ongoing efforts to hold accountable those responsible for the scam and provide restitution to affected parties.