OneCoin co-founder Karl Sebastian Greenwood has been sentenced to 20 years in prison for defrauding millions of people who invested in OneCoin, the United States Attorney Office for the Southern District of New York revealed on Tuesday.
Greenwood co-founded OneCoin in 2014 with the so-called crypto queen-turned-fugitive Ruja Ignatova. The partners marketed and sold the fraudulent cryptocurrency through a global multi-level marketing (MLM) network.
With the MLM structure, Greenwood earned 5% of the monthly OneCoin sales from anywhere in the world, which totaled more than $200 million from the fourth quarter of 2014 through the fourth quarter of 2016 alone and surpassed approximately $300 million in total.
According to the prosecutor, OneCoin was presented as a unique and innovative crypto project. The founders deliberately compared it to Bitcoin, prompting investors to see it as a legitimate digital asset with massive returns. Sadly, about 3.5 million individuals fell victim, resulting in a loss of more than $4 billion.
Greenwood also earned more than $300 million from the scheme, which he spent on a five-star resort in Brazil, a luxury villa in Thailand, designer outfits, real estate in multiple countries, a private plane and a yacht.
He was arrested in Thailand and extradited to the United States to face fraud and money laundering charges in 2018. He pleaded guilty in the case.
Ignatova, the other co-founder, faced similar charges but has not been seen publicly since 2017, when she took a flight to Greece. She was added to the FBI’s Top Ten Most Wanted List in June 2022, the attorney’s office said.
U.S. Attorney Damian Williams described the scheme as one of the largest frauds ever perpetrated.
“Greenwood and his co-conspirators, including fugitive Ruja Ignatova, conned unsuspecting victims out of billions of dollars with promises of a ‘financial revolution’ and claims that OneCoin would be the ‘Bitcoin killer,’ OneCoins were worthless. 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 added.
In addition to his prison term, Greenwood was ordered to pay approximately $300 million in forfeiture.
