The founder of Romania-based crypto exchange Coinflux has pled guilty to laundering over $1.8 million worth of Bitcoin
Vlad-Călin Nistor, the founder of crypto exchange Coinflux and 14 other defendants, including the owner of a car wash, pled guilty for their roles in a transnational and multi-million dollar scheme to defraud U.S. residents.
The guilty pleas were issued at the Eastern District Court of Kentucky, per an announcement on June 11th from the U.S. Department of Justice (DOJ). Four of the guilty pleas were made by Romanian nationals in the past 24 days, with two taking place in the last 24 hours, the announcement stated.
Vlad-Călin Nistor, 33, of Romania, pleaded guilty on May 19, 2020, to one count of RICO conspiracy. According to plea documents, Nistor was the founder and owner of the Romania-based Bitcoin exchange Coinflux Services SRL. He exchanged cryptocurrency into local fiat currency on behalf of the Romania-based members of the conspiracy, knowing that the Bitcoin represented the proceeds of illegal activity. According to plea documents for example, Nistor exchanged over $1.8 million worth of Bitcoin for co-defendant Bogdan Popescu.
Bogdan-Stefan Popescu, 30, of Romania, pleaded guilty on June 11, 2020, to one count of RICO conspiracy (Racketeer Influenced and Corrupt Organizations Act). According to plea documents, Popescu operated a car wash in Bucharest, Romania, where he managed coconspirators in the RICO enterprise. From at least December of 2013, Popescu oversaw an operation whereby he knowingly negotiated fraudulently obtained Bitcoin. He did so in many ways.
For example, he would sometimes receive cryptocurrency from coconspirators who obtained the funds through online fraud scams, transfer the cryptocurrency to other conspirators such as codefendant Vlad-Călin Nistor. He would then direct that Nistor exchange the cryptocurrency for fiat currency, and deposit the fiat currency into bank accounts held in the names of various employees and family members.
According to court documents, in addition to providing money-laundering services, Popescu also coordinated the dissemination of tools used to defraud American-based victims, such as the language and photographs for fake advertisements as well as usernames and passwords for IP address anonymizing services. Popescu also assisted members of the RICO conspiracy by connecting them with other members who could provide call center services—that is, who would impersonate eBay customer service representatives over the phone.
“Today’s modern cybercriminals rely on increasingly sophisticated techniques to defraud victims, often masquerading as legitimate businesses,” said Assistant Attorney General Brian A. Benczkowski of the Justice Department’s Criminal Division. “These guilty pleas demonstrate that the United States will hold accountable foreign and domestic criminal enterprises and their enablers, including crooked bitcoin exchanges that swindle the American public.”
“Through the use of digital currencies and trans-border organizational strategies, this criminal syndicate believed they were beyond the reach of law enforcement,” Assistant Director Michael D’Ambrosio, U.S. Secret Service, Office of Investigations, said in the DOJ statement. “However, as this successful investigation clearly illustrates, with sustained, international cooperation, we can effectively hold cyber criminals accountable for their actions, no matter where they reside.”
Nistor was arrested in December 2018 on an international warrant and was extradited to the U.S. The defendants now await sentencing.
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