The founder of a Bulgarian cryptocurrency exchange has been sentenced to 121 months in prison for money laundering and conspiracy to commit a Racketeer Influenced and Corrupt Organizations Act (RICO) offense.

The sentence was handed out by U.S. District Court Judge Robert E. Weir, who sentenced Rossen G. Iossifov, 53, formerly of Bulgaria, for conspiracy to commit a RICO offense and conspiracy to commit money laundering.

According to information revealed during the trial, Iossifov owned and managed the RG Coins cryptocurrency exchange that was headquartered in Sofia, Bulgaria.

Iossifov was accused of intentionally designing his platform with money laundering in mind. While doing this, he took a number of steps to limit his legal liability. At least five of the people who used RG Coins were members of a network of fraudsters known in the court records as Alexandria (Romania) Online Auction Fraud (AOAF) Network.

How he was involved in Money Laundering

More specifically, according to court documents and evidence presented at trial, Iossifov and his co-conspirators participated in a criminal conspiracy that engaged in a large-scale scheme of online auction fraud that victimized at least 900 Americans. Romania-based members of the conspiracy posted false advertisements to popular online auction and sales websites — such as craigslist and eBay — for high-cost goods (typically vehicles) that did not actually exist. Once victims were convinced to send payment, the conspiracy engaged in a complicated money laundering scheme wherein domestic associates would accept victim funds, convert these funds to cryptocurrency, and transfer proceeds in the form of cryptocurrency to foreign-based money launderers. Iossifov was one such foreign-based money launderer who facilitated this final step in the scheme.

According to evidence at trial, Iossifov designed his business to cater to criminal enterprises by, for instance, providing more favorable exchange rates to members of the AOAF Network. Iossifov also allowed his criminal clients to conduct cryptocurrency exchanges for cash without requiring any identification or documentation to show the source of funds, despite his representations to the contrary to the major bitcoin exchanges that supported his business. Evidence submitted during trial and his sentencing hearing revealed that Iossifov laundered nearly $5 million in cryptocurrency for four of these five scammers in a period of less than three years. This represented over $7 million in funds defrauded from American victims. In return, Iossifov made over $184,000 in proceeds from these transactions.

U.S. Department of Justice
rgcoins card money laundering

Iossifov intentionally gave more favorable exchange rates to members of the (AOAF) Network, according to court documents. Despite his claims to the contrary, he did not require any form of identity verification from his alleged “criminal clients.”

In three years of operation, Iossifov laundered approximately five million dollars through his exchange. Of the five million in laundered funds, Iossifov earned a paltry $184,000.

Published by: https://darkweblive.net