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Ukrainian law enforcement has uncovered a financial pyramid originating from Russia, suspected of making millions of US dollars. The scam convinced victims to send fiat money and cryptocurrency by promising profitable investments in large companies around the world.
Officers from the Security Service of Ukraine (SBU) have exposed a fake investment scheme called “Life is Good”, the agency announced on Tuesday. The fraudsters behind it offered potential customers to multiply their money by buying shares in global businesses.
The organizers of the large-scale pyramid scheme allegedly received almost $40 million from more than 1,000 people they managed to defraud. Victims were asked to transfer the money directly to the crypto wallets and bank accounts of the fraudsters.
Life Is Good had an online platform that maintained fake investor accounts. The customers were promised agreements that provided stable profits in the form of dividends and “guaranteed” bonuses if they were able to attract new participants to the project.
According to the Ukrainian investigators, more than 10 people have been involved in the criminal organization, mainly Russian citizens. The financial pyramid, which was launched in Russia in 2017, had a local branch in Ukraine.
After Russia’s full-scale invasion that began in late February 2022, the organizers tried to hide their involvement in the scheme by devising a mechanism to collect cryptocurrencies through a network of exchanges operating throughout Ukraine.
In cooperation with their colleagues from the Ukrainian police and the prosecutor’s office, the SBU officers searched Life Is Good’s offices in Kiev, seizing computers, mobile phones, accounting documents and other records suggesting criminal activity as well as advertising materials.
Law enforcement agencies in Ukraine, a regional leader in cryptocurrency adoption, have improved their crypto expertise. According to a report in March, employees of the country’s Cyberpolice, Asset Recovery and Management Agency and SBU attended training courses organized by Binance, the world’s leading digital asset exchange.
In November, Cyberpolice, the country’s anti-cybercrime unit, dismantled a crypto-fraud scheme allegedly making 200 million euros a year ($207 million at the time) by luring investors through a chain of representative offices and call centers across Europe.
Why do you think the alleged Russian crypto scammers continued to operate in Ukraine after the war broke out? Share your thoughts on the matter in the comments section below.
Image credit: Shutterstock, Pixabay, Wiki Commons, SBU
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