The owner of the small-scale Bulgarian exchange RGcoins Rosen Iossifov, faces harsh consequences following a sophisticated scam involving stealing from US citizens and consequential money laundering using digital coins. Iossifov was convicted in Kentucky before a federal judge on counts of conspiracy to commit racketeering and money laundering.
RGcoins got the attention of US authorities following a suspicion that Iossifov helped a gang of Romanian money launderers.
The official court documents reveal that, between 2014 and 2015, Iossifov and co. used phishing attacks to victimize some 900 Americans. The fraudsters used fake ads on popular sites like eBay and Craigslist to promote expensive assets that did not exist.
All purchased products were never received by the buyers; the money was embezzled by a group of 14 Romanians who used RGcoins to convert it into bitcoin. In other words, they committed money laundering.
According to a statement released by US court prosecutors,
“…once victims were convinced to send payment, the conspiracy participants 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,”
The Bulgarian national was arrested way back in 2018. In 2019 he was extradited to the United States, where the case could be better investigated. As of now, Rosen Iossifov could be sentenced to 20 years in prison, a fine of $250k, and three years of supervised release. The sentence is expected to become official on 12th January, 2021.