The owner of a Bulgarian bitcoin exchange has been sentenced to prison in the United States for his involvement in fraud and assisting criminals in money laundering.
After a two-week trial in September 2020, the jury found Rossen G. Iossifov guilty of conspiracy to commit wire fraud and money laundering. On January 12, U.S. District Court Judge Robert E. Weir sentenced Iossifov, a 53-year-old Bulgarian national, to 121 months in prison.
The defendant was the owner and manager of the Bulgarian bitcoin exchange RG Coins, based in Sofia. According to court documents, Iossifov knowingly helped criminals launder money from illegal activities and was trying to protect himself from any criminal liability.
At least five of Iossifov's key clients were Romanian fraudsters, belonging to a criminal organization, which was referred to in court as the Alexandria (Romania) Online Auction Fraud (AOAF) Network.
This group is said to have defrauded hundreds of people through fake ads on popular auction and sales sites, including Craigslist and eBay. The scammers advertised high-priced products (usually vehicles) that did not actually exist.
Once victims were convinced to send the money for payment, the money laundering scheme would begin. Local associates would accept money from victims, convert it into cryptocurrencies , and transfer it in that form to money laundering services overseas.
“Iossifov was one of the foreigners who took charge of the money laundering and facilitated this final step of the plan“.
The Bulgarian defendant allowed criminal clients to exchange cryptocurrency for cash, without requiring any identification or documentation of the source of the money. Members of the AOAF Network criminal organization also received special treatment, with more favorable exchange rates than other clients.
Authorities discovered that Iossifov helped launder $5 million in cryptocurrency for four of the five fraudsters in less than three years. In return, the owner of the bitcoin exchange service earned more than $184,000.
In addition to Iossifov, 16 other AOAF members have been convicted for their involvement in this fraud.
Source: Infosecurity Magazine
