The co-founder of the fraudulent OneCoin cryptocurrency, a massive pyramid scheme that amassed over $4 billion from millions of investors worldwide, was sentenced Tuesday to 20 years in prison.
Karl Sebastian Greenwood, who orchestrated the multibillion-dollar multi-level marketing con, pleaded guilty in December to wire fraud and money laundering charges.
His partner, Ruja Ignatova, known as the “Cryptoqueen” on the FBI’s Top 10 Most Wanted list, remains at large, the Department of Justice said.
Greenwood “operated one of the largest fraud schemes ever perpetrated,” U.S. Attorney Damian Williams said in a press release.
“We hope this lengthy sentence resonates in the financial sector and deters anyone who may be tempted to lie to investors and exploit the cryptocurrency ecosystem through fraud,” Williams said.
Greenwood’s sentence was imposed by federal Judge Edgardo Ramos in U.S. District Court in lower Manhattan.
OneCoin, which began in Bulgaria in 2014, took in more than $4 billion from at least 3.5 million people between 2014 and 2016, the DOJ said. The scheme was marketed and sold through a multi-level marketing structure, which paid commission to OneCoin members who recruited others to buy crypto packages.
Greenwood, the top distributor, received 5% of all OneCoin sales — raking in more than $300 million in total, the DOJ said.
Both Greenwood and Ignatova consistently portrayed OneCoin as being the next Bitcoin-like crypto investment opportunity. But “unlike legitimate cryptocurrencies, OneCoin had no actual value and was conceived of by Greenwood and Ignatova as a fraud from day one,” the DOJ said.
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