On 28th September 2020, the United States Department of Justice, in a public release, announced the conviction of RG Coin owner. The Bulgaria national was guilty of his role in a transitional and multi-million dollar scheme to defraud Americans victims via online auction fraud.
The former Bulgaria national goes by the name Rossen Iossifov and is 53 years old. He got convicted by a federal jury in Frankfort, Kentucky of one, count of conspiracy to commit racketeering. Rossen was also guilty of conspiracy to money laundering, and this got reached after a two-week trial in front of US District Judge, Robbert E Wier. The sentencing will happen on 12th January 2021.
How RG Coin Carried Out their Fraud
According to the evidence and court documents presented in the trial, Iossifov and his conspiracy members engaged in a massive scale scheme of online auction scheme. This fraud victimized at least 900 Americans.
These Romania-based conspiracy members posted false promotions to widely known auction and sales websites. Examples of these websites are Craiglist and eBay. These fraudsters advertised for expensive items that did not exist.
These conspiracy members would then convince American victims to pay them for the advertised goods. They tricked their victims by crafting persuasive narratives, for instance, by impersonating a military member who wanted to sell some items before deployment.
How these Fraudsters Succeeded to Trick their Victims
According to the court, the conspiracy members made fictitious online accounts where they posted their advertisements. They also used these pseudo accounts to communicate with their victims. These fraudsters also used stolen Americans’ identities to fraud their victims.
They also dropped invoices to their victims, bearing highly regarded companies’ trademarks, for their transaction to look authentic. Members of the conspiracy also established call centers and impersonated customer support to address questions and reduce concerns over the false advertisements.
The court documents also point out that, once victims got persuaded to make payments, the fraudsters engaged in a complicated money laundering scheme. These conspiracy members converted the funds to cryptocurrency and transferred proceeds in digital coins to foreign-based money launderers. The evidence at trial also shows Iossifov owned RG Coin, a Bulgarian-based cryptocurrency exchange.
Iossifov exchanged cryptocurrency into local fiat currency on behalf of the Romania-based conspiracy members without caring that the virtual currency represented the proceeds of illegal; activity. The unlawful cryptocurrency exchange took place from at least September 2015 to at least December 2018. Iossifov exchanged over $ 4.9 million worth of bitcoin in two and a half years for the four other criminal enterprise members. However, seven total defendants got convicted, and three others are fugitives.