In brief
- A Serbian man and his partners allegedly defrauded crypto investors out of more than $70 million.
- He has been extradited to northern Texas, where he had targeted several victims.
- The scam spanned several continents, according to the indictment.
The US Department of Justice (DoJ) announced on Friday that Serbia extradited its citizen, Antonije Stojilkovic, to the US to face charges over conspiracy to commit fraud and money laundering.
Stojilkovic and his partners are accused of defrauding crypto investors out of more than $70 million in “a global con” that targeted investors across several continents.
It is alleged that Stojilkovic and his more than a dozen partners set up, from their home bases in China, Serbia, and elsewhere, more than 20 bogus trading platforms.
The platforms operated under the names of Options Rider, Bancde Options, Start Options, Dragon Mining, BTC Mining Factor, and Trinity Mining.
Through these platforms, the co-conspirators advertised binary options and cryptocurrency mining services to unwitting investors around the world.
“This $70 million scam spanned several continents, targeting American citizens and foreigners alike,” said Acting U.S. Attorney Prerak Shah in a statement.
“We are proud to bring Mr. Stojilkovic to Dallas to face justice in an American courtroom. The U.S. Department of Justice will not relent in our fight against cybercrime.”
How the alleged scam worked
The DoJ alleged that Stojilkovic and his coconspirators falsely advertised their binary options services as “the world’s market leader in binary options” that offered an unusually suspicious “average payout of 80 percent, and promised 20 percent refunds on every lost trade”.
In what should have also raised alarm bells, their cryptocurrency mining platforms promised that investors would “purchase bitcoin at half market price!!” thanks to their “24-7 mining” at facilities “worldwide.”
It is not that Stojilkovic and his coconspirators scammed investors in some parts of trading activity; there was no trading activity in the first place, according to the DoJ’s indictment.
A Serbian man has been extradited from Serbia to the United States to face allegations that he and others duped investors out of more than $70 million.https://t.co/HqaDZiHgus
— US Attorney N. Texas (@NDTXnews) February 5, 2021
The DoJ said that the group displayed fake figures on their scam investment portals, fabricating returns on investments. By generating a series of fake wire receipts and fraudulent withdrawal history logs, Stojilkovic and his coconspirators made investors think a legitimate activity was in full swing.
But these alleged crypto con-artists used those investment funds towards the operating costs of the scam and for their personal expenses, claimed the DoJ.
To make their online presence convincing and respectable, Stojilkovic and his coconspirators also catfished investors, according to the DoJ. They apparently created fake profiles with mostly female names and profile pictures, going so far as using those fake identities during video conference calls with potential investors.
China busts huge crypto scam, seizes Ferrari, villas and $15 million
Chinese police have confiscated 100 million yuan (roughly $15 million) as well as luxury cars and villas, worth around $2.15 million combined, from a group of alleged crypto scammers. The arrestees are suspected of selling fake Huobi tokens to over 1,300 of their victims, local news outlet Toutiao reported today. According to the article, China’s Ministry of Public Security announced the arrest of 10 individuals who allegedly attracted potential investors via dozens of Telegram channels, such as...
This “global con”, as described by the Dallas FBI Special Agent in Charge Matthew J. DeSarno, targeted several people in northern Texas, which is why Stojilkovic was extradited to that part of the US. He could face 20 years in US prison.
There no public information yet as to whether any other country made a similar extradition request for Stojilkovic or any of his coconspirators.
Crypto scams: the bigger picture
Allegation of scams in cryptocurrency investments are not uncommon.
In early January, Intezer Labs discovered that malware in fraudulent cryptocurrency apps infected thousands of users over the last year in search of crypto keys.
24-Year-Old Trader Convicted After $90 Million Crypto Scam
Stefan He Qin, an Australian crypto fund manager, has pled guilty to a single count of fraud levied against him in a New York federal court, in connection with a $90 million crypto scam, as per local news outlet ABC. The 24-year-old Qin managed and ran Virgil Capital, his crypto fund since 2016, supposedly handling millions of dollars worth of client investments. His falsely marketed profits landed him a spot on CNBC as a financial whizkid and even a feature on the reputed financial publication...
Last month, The SEC filed charges against three individuals involved with defunct crypto projects Start Options and Bitcoiin2Gen that lured $11 million out of investors in an ICO.
And last summer, cybersecurity firm Group-IB identified a fraudulent scheme that lured investors with fake celebrity testimonials to tout investment portals.
But what sets the DoJ’s current case apart from others is how labor-intensive it appears to be.
