According to a press release from the Department of Justice, Karl Greenwood, a co-founder of the OneCoin pyramid scheme, pleaded guilty to federal U.S. charges.
Prosecutors claim that the ostensible cryptocurrency project has been deceptive since its inception in 2014. Karl Greenwood, OneCoin’s co-founder, set up a pyramid scheme to market the cryptocurrency to millions of people, generating up to $4 billion in revenue. Greenwood pleaded guilty to wire fraud and conspiracy to launder money after an internal message allegedly depicted the investors as idiots.
“Karl Sebastian Greenwood operated one of the largest international fraud schemes ever perpetrated,” said U.S. Attorney for the Southern District of New York Damian Williams. Greenwood and his associates, including fugitive Ruja Ignatova, duped unsuspecting victims out of billions of dollars by claiming OneCoin would be the “Bitcoin killer.”
OneCoin, founded in Bulgaria in 2014, mislabeled itself as a cryptocurrency, telling investors that the token could be mined and had real value when, in fact, it did not exist on the blockchain. Ignatova was named one of the FBI’s “Ten Most Wanted Fugitives.”
Ignatova, also known as the “CryptoQueen,” is still on the FBI’s Most Wanted list as another founder of OneCoin, which was based in Bulgaria. The FBI is offering a $100,000 reward for information leading to her arrest.
According to Williams, the purpose of this case and other recent actions is to send a clear message that we will go after anyone who tries to exploit the cryptocurrency ecosystem through fraud, regardless of how large or sophisticated they are.
Greenwood, a Swedish and British citizen, was arrested in Thailand in 2018 and extradited to the United States.
According to a 2020 indictment unsealed this week in the United States District Court for the Southern District of New York, Frank Schneider, an alleged participant in OneCoin’s $4 billion Ponzi scheme, is facing charges of wire fraud and money laundering.