A $40 million compensation fund has been established for victims of the $4 billion OneCoin cryptocurrency scam, as announced by the US Department of Justice. The fund consists of seized assets and is intended to provide reparations to those affected by the international scheme, which operated from 2014 to 2019 and defrauded up to 3.4 million investors worldwide. OneCoin's co-founders, Ignatova and Karl Sebastian Greenwood, orchestrated the global multi-level-marketing network, which sold a fraudulent cryptocurrency through a network of promoters. The scheme ultimately collapsed in 2017 after it was discovered that the perceived value of OneCoin was being manipulated.
The US Department of Justice has described the scheme as 'one of the largest global fraud schemes in history.' In an effort to hold those responsible accountable, the DOJ has offered a $5 million reward for information leading to the capture of the missing 'Cryptqueen.' Furthermore, Greenwood has admitted to federal wire fraud and money laundering charges. US Attorney Jay Clayton stated that the founders of OneCoin 'sold a lie disguised as cryptocurrency, costing victims more than $4 billion worldwide.' The DOJ remains committed to seizing criminal proceeds and prioritizing the return of funds to victims.
This development comes on the heels of the FTX Recovery Trust's announcement to distribute $2.2 billion to creditors, as part of a broader effort to recover assets for users of the crypto trading platform that collapsed in November 2022.