Bangkok: A cofounder of the OneCoin pyramid scheme pleaded guilty to his role in the global, multibillion-dollar fraud.
Karl Sebastian Greenwood admitted OneCoin, which he founded in 2014 with Ruja Ignatova, the so-called “Cryptoqueen,” was based on a phony cryptocurrency. Greenwood, who was arrested in Thailand in 2018 and extradited to the US, pleaded guilty Friday to three criminal counts of conspiracy and wire fraud in a hearing in Manhattan federal court.
Greenwood admitted hyping OneCoin as competition to Bitcoin despite knowing it was a fraudulent currency whose value was arbitrarily set by its backers, not the market, and was used to lure victims into a multi-level marketing scam.
“I knew at the time I participated in this conspiracy in the US that it was wrong,” Greenwood, shackled at the ankles and wearing tan jail fatigues, told US District Judge Edgardo Ramos. Greenwood faces as long as 20 years in prison on each of the counts when he’s sentenced.
OneCoin generated 3.4 billion euros ($3.6 billion) in revenue from the fourth quarter of 2014 to the third quarter of 2016, according to the government, but had no real value and couldn’t be used to buy anything. It operated as a Ponzi scheme, paying commissions to members worldwide for recruiting others to buy OneCoin packages, according to the government.
The company, which was based in Sofia, Bulgaria, claimed to have more than 3 million members worldwide. Ignatova disappeared in 2017 as OneCoin came under suspicion. She was added to the FBI’s list of Ten Most Wanted fugitives.
