A group of convicted Austrian fraudsters financed a lavish lifestyle with funds obtained from a huge cryptocurrency scam. Among the other luxuries they bought were a shark tank, a vacation home, luxury cars, private jet travel and night club parties, Austrian news agency Hoyte reported on October 23. Approximately 40,000 people reportedly fell victim to this plan. The total amount accumulated through this fraud is approximately $21.6 million (€20 million).
Cryptocurrency scammer arrested
The operation of the fraudulent investment scheme was based on investments in EXW wallets, EXW crypto tokens, and real estate projects. EXW promises attractive returns of 0.1% to 0.32% daily, which attracts the attention of most investors.
The EXW wallet started to malfunction in 2020 after being activated in 2019. After adding more suspects, authorities charged eight people in September 2023 with money laundering, pyramid schemes, and commercial fraud.
By October 23, the Klagenfurt District Court had convicted five people accused of fraud. Two received five years in prison without parole, and two others received 30 months. One additional defendant was sentenced to 18 months in prison, and five others were acquitted. Three of the defendants’ previous convictions are subject to sentencing, and some of those convicted reportedly plan to appeal.
Investigational objections and additional charges
“Austria’s biggest fraud trial,” as Hoyte calls it, took more than a year, with 60 days in court, 300 hours of lengthy negotiations, and 3,000 dockets. Prosecutor Caroline Chedik Eisenberg said the fraud was not simple, as it involved operations in multiple countries with no extradition treaties, including the UAE.
To further obfuscate the financial trail, the fraudsters used encrypted Telegram communications and even enlisted the help of companies that are experts in this field. Some people transported the funds to Austria in plastic bags, the report revealed.
Chedik-Eisenberg explained that the operation had no intention of pursuing any profitable projects, and that the initial promises were only intended to attract victims. The defense contends that some defendants simply lost control because the plan became too big to handle.
Separate charges have been laid in a cannabis-related fraud case in which an estimated $17.2 million (16 million euros) was stolen from more than 17,000 people.
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