Daily fraud update: 16th June

Forex Fraud Analyst Team
Coinflux website homepage on a phone screen

Coinflux founder pleads guilty in fraud claims

The founder of a bitcoin exchange has pleaded guilty over claims that he participated in an online auction fraud.

According to press reports, Vlad-Călin Nistor, who set up the now-defunct exchange Coinflux, was involved in a conspiracy to defraud customers of a supposed online auction.

It is alleged that Nistor and 14 other defendants, all of whom are from Romania, made millions of dollars in total.

Allegedly, those involved released adverts on auction websites such as eBay as well as listings websites such as Craiglist.

The adverts promoted items to buy – however, the adverts were allegedly fake, and the items for sale apparently did not exist.

The accused then apparently went on to trick people in the US to send over cash to purchase the items.

In one case, an alleged victim was told that they needed to send the cash so that a member of military personnel could receive the goods before being sent away.

There is also an alleged element of identity theft to the case.

The corporate identities of legitimate companies, such as trademarks, were allegedly stolen in order to create invoices to trick victims.

The defendants also supposedly set up accounts in order to post the adverts and reach out to potential victims – and in some cases, they used the details of real people.

In a further twist, the defendants are also accused of carrying out money laundering.

They are alleged to have turned the cash they received into crypto before moving it on to other locations.

The guilty pleas came in front of US Magistrate Judge Matthew A. Stinnett, of the US District Court for the Eastern District of Kentucky.

In a statement, prosecutors in the US shared more insights on the case.

“Today’s modern cybercriminals rely on increasingly sophisticated techniques to defraud victims, often masquerading as legitimate businesses,” said Brian A. Benczkowski, an Assistant Attorney General at 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,” he added.

US Attorney Robert M. Duncan Jr., who works in the Eastern District of Kentucky, added that “extraordinary cooperation” had helped bring the 15 to justice.

“The guilty pleas announced today are a direct result of the extraordinary cooperation and partnership among law enforcement agencies at the local, state, federal, and international levels,” he said.

He added: “These partnerships helped dismantle a sophisticated organized crime group who preyed upon victims across the United States.

“I commend the exceptional work conducted by our law enforcement partners and trial team members who worked diligently to hold these defendants accountable.”

There were also strong words on offer from Kentucky State Police Commissioner Rodney Brewer.

“These are scam artists who hide behind a wall of technology which allows them to prey upon innocent victims throughout the United States,” he said.

Forex Fraud Analyst Team

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