Ruja Ignatova was the darling of the cryptocurrency world. Now, both she and billions of investor funds are missing. Hundreds of Irish investors have been caught, while the perpetrators are alleged to have laundered $300 million through Bank of Ireland.
However, the story has taken a new twist, and it centres on horseracing.
Horse Racing Ireland, the national authority for thoroughbred racing, has said it is “monitoring” reports about Phoenix Thoroughbreds, a Middle East organisation with a number of horses in Ireland.
The founder of this business, Amer Abdulaziz Salmans, has been accused in a US court of being a key player in receiving funds from the fake cryptocurrency OneCoin, which has seen investors lose an estimated $4 billion globally in the scheme run by the self-styled cryptoqueen Ignatova.
According to evidence given by the FBI in the United States, a Bank of Ireland bank account was allegedly used to wire 11 transfers of funds totalling €185 million that were the alleged proceeds of the OneCoin fraud to the Dubai bank of the “Phoenix Fund”.
As a result of these OneCoin allegations, Phoenix has been “banned” from racing in France by France Galop, according to The Racing Post. The move came days after the Middle East horse business said it was withdrawing from the British market.
When contacted by The Currency yesterday, a spokesperson for Amer Abdulaziz denied all allegations of wrongdoing.
“Although Phoenix has announced that it will pull out of the UK, there is no intended change to racing operations in Ireland,” he said.
He said Phoenix’s position remained the same as last November when allegations of links to OneCoin first emerged in the US.
“Phoenix Fund Investments LLC categorically denies all allegations made against it, and its owner, Mr Amer Abdulaziz, in legal proceedings against OneCoin and its conspirators in the US,” he said. “Phoenix Fund Investments LLC believes that the firm and Mr Amer Abdulaziz have acted according to the law at all times, and will vigorously contest all allegations of wrongdoing,” he added.
In addition, the spokesman said: “Phoenix Fund Investments LLC will fully cooperate with relevant authorities should they require any assistance.”
Phoenix said it is taking legal advice and would take “appropriate action against those involved in the publication of false and defamatory statements”.
He said he could not respond to questions in relation to the Bank of Ireland at present, but hoped to do so by the end of this week.
A spokesperson for Horse Racing Ireland issued a statement in response to questions from The Currency. “Phoenix Thoroughbreds is a registered owner in Ireland and currently has a small number of horses in training here.
“Horse Racing Ireland keeps ownership records under review at all times, is aware of media reports surrounding Phoenix Thoroughbreds, and continues to monitor developments.
“It is in regular contact with other racing jurisdictions on this and other matters. While Horse Racing Ireland does not have an investigative function, it works closely with the relevant State authorities and would not hesitate to act should the request be made by the Courts or An Garda Síochána.”
Tracking the Cryptoqueen
Where the estimated $4 billion stolen fraudulently from investors in fake cryptocurrency OneCoin went is one of the great mysteries of business.
The founder of OneCoin, a Bulgarian businesswoman called Dr Ruja Ignatova, has gone missing. So too has most of the money.
She is the subject of a BBC podcast called The Missing Cryptoqueen, listened to by millions of people and made by investigative journalist Jamie Bartlett and producer Georgia Catt.
A draft transcript of a post-arrest interrogation interview in 2018 by two FBI special agents show that Scott is already weaving a story about money flowing around the world including Ireland.
Bartlett is now working on a book about OneCoin with Ebury Press. Jen McAdam, a Glaswegian woman who lost a fortune on OneCoin and then set out to expose the fraud, is also writing a separate book on what could be the world’s largest fraud. A movie is also rumoured to be in the offing.
Ireland is a key participant in the money trail of vast sums flowing all over the world that are allegedly connected to OneCoin. The trial of Mark Scott, a lawyer who amassed mansions and a yacht, revealed numerous connections between the cryptocurrency and Ireland.
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Lawyer Mark Scott was convicted last year of money laundering $400 million of fraudulently stolen OneCoin proceeds. Scott pocketed $50 million in fees for his troubles.
Thousands of pages of courtroom transcripts and exhibits reveals the numerous ways he allegedly used an Irish bank and various Irish companies to move hundreds of millions of euro around the world.
A draft transcript of a post-arrest interrogation interview in 2018 by two FBI special agents show that Scott weaved a story about money flowing around the world including Ireland.
He claims that this money was all for legitimate business deals. Under interrogation, he tells FBI special agent James Ekel he tries to explain it all away. He claims that the reason so much money is going through his accounts is to facilitate business deals, especially in the telecommunications sector.
Derek Collins, executive vice president Bank of Ireland and Carol Sinclair, who works in assurance and risk with the bank, were both interviewed as witnesses. No wrongdoing is alleged against either Collins or Sinclair.
“We didn’t close them all, you know, but umm we did some in Colombia and tried in Panama. Umm, and other countries, yeah so… including Germany, Ireland,” Scott claimed. “Yeah, we looked at Panama, we looked at Columbia, Ecuador. I know we were very close with Ireland, so we went to Ireland to buy all the towers of O2.”
Asked if he ever closed any of these deals, he said: “Not, not with my clients. I heard after a couple of them did close, but not with us involved.”
The FBI clearly did not believe any of Scott’s claims – and there is no evidence that he ever looked at any real deals here – as after this interrogation it proceeded to successfully prosecute him.
When the FBI visited an unwitting Bank of Ireland
Bank of Ireland was unwittingly central to Scott’s endeavours to shift hundreds of millions of euro around the world. Exhibit E in Scott’s prosecution prepared by the Department of the Treasury Internal Revenue Service Criminal Investigation describes how three FBI special agents and three United States attorneys interviewed two Bank of Ireland employees in the bank’s headquarters in Burlington Plaza, Dublin 4.
Derek Collins, executive vice president Bank of Ireland and Carol Sinclair, who works in assurance and risk with the bank, were both interviewed as witnesses. No wrongdoing is alleged against either Collins or Sinclair and the FBI and the lawyers are merely trying to ascertain what they know about Scott and the Fenero funds which had bank accounts in Bank of Ireland. Collins told the agents how Scott claimed he was an investor on the behalf of various European families in telecoms and financial services.
Kroll states that Irish companies Fenero Equity Investments Ireland and Fenero Tradenext Holdings were set up by Scott and that these companies had bank accounts in Bank of Ireland.
Collins said he was not suspicious about Scott, who was using a British Virgin Islands entity, as he came recommended.
The memo states:
“The initial email that came in concerning Scott had two (2) high level partners copied on them. Collins viewed Ailish from Arthur Cox as “top notch”. If Scott came to the bank “off the street” they would have checked to see who his law firm was.
“Collins had no suspicion of Scott or Finero. Scott accounts moved from High Risk to Medium Risk.”
On legal advice, no Bank of Ireland employee ever appeared as a witness in the United States in Scott’s trials despite an offer by the US government to pay for their flights and accommodation. US prosecutors accepted fully that Bank of Ireland officials had been deceived by Scott and there is no suggestion of any wrongdoing by the bank or its employees.
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On November 14, 2019, during the trial of Mark Scott in the Southern District of New York, special agent Nicholas Kroll gave extensive evidence of the alleged money laundering of the American lawyer. He describes an intricate array of movements of vast sums of money between the British Virgin Islands, Ireland, the Middle East and elsewhere.
Another payment of €3.25 million moves through Bank of Ireland to a company called Oceanscape Ventures in Bank Julius Baer in Singapore.
Kroll draws upon evidence gathered from numerous sources including information garnered from Ignatova’s brother Konstantin, a 33-year-old tattooed former MMA fighter, who pled guilty last year in America to fraud and money laundering offences.
Kroll states in his evidence on November 14, 2019 that: “Last transfer from Fenero Securities Trading Limited account at Bank of Ireland to Phoenix Fund Invest at NBD Bank in Dubai, a total of €185 million sent across 11 separate wire transfers.”
Kroll states that Irish companies Fenero Equity Investments Ireland and Fenero Tradenext Holdings were set up by Scott and that these companies had bank accounts in Bank of Ireland. Correspondence was also produced from 2017 between Scott and Ignatova. In this Scott sends her information about Fenero and Phoenix which he says “will clear KYC (Know Your Customer).”
Part of this information was read out as describing a business agreement “by and between Fenero Securities Trading Limited, and Phoenix Fund Investments LLC.”
Lawyers for the United States add in the next line of a transcript of proceedings: “Further in that same section it says represented by Aamer Abdulaziz Ahmed Salman.”
Phoenix and its owner Abdulaziz Ahmed have denied that they benefited in any way from money related to OneCoin and they have denied they engaged in any wrongdoing.
Aside from this, the court also heard of other substantial sums flowing through the Bank of Ireland to other jurisdictions to various companies.
It is not clear who these sums were for, but they are suspected to be for the benefit of Ignatova herself and others in her inner circle.
A timeline is discussed of Scott’s movements which includes a meeting he had on September 16, 2016 with Ruja in Sofia, Bulgaria. The court heard that on September 29, 2016, Fenero Equity Investment’s Bank of Ireland bank account sent €5 million to a bank account in Piraeus Bank in Bulgaria called Vida Home. On July 25, 2016 the same Irish company sent another €2.5 million via Bank of Ireland to the Vida Home account in Bulgaria.
Another payment of €3.25 million moves through Bank of Ireland to a company called Oceanscape Ventures in Bank Julius Baer in Singapore. Later Fenero Equity Investment Ireland transfers €10 million from its Bank of Ireland account to IG Markets.
Where the money went remains opaque and as mysterious as the disappearance of its enigmatic founder Dr Ruja Ignatova.
The same bank account and other accounts in other banks outside Ireland are then used to send a total of €51 million to InvestBank in Bulgaria. Vast sums of money certainly moved through Bank of Ireland as well as many other banks and jurisdictions, in a dazzling raft of transactions.
The US Department of Justice has described OneCoin as a “massive pyramid fraud scheme,” perhaps the largest in the history of the world. FBI Assistant Director-in-Charge of investigations into OneCoin William Sweeney, Jr has said: “Unlike authentic cryptocurrencies, which maintain records of their investors’ transaction history, OneCoin had no real value.
“It offered investors no method of tracing their money, and it could not be used to purchase anything. In fact, the only ones who stood to benefit from its existence were its founders and co-conspirators.”
Where the money went remains opaque and as mysterious as the disappearance of its enigmatic founder Dr Ruja Ignatova. She was last seen on or about October 25, 2017 on a Ryanair flight from Sofia, the capital of Bulgaria, to Athens in Greece. There have however been many rumours of where she might be since. She is said to have plastic surgery to disguise her identity, and may even have visited Ireland.
For journalist Jamie Bartlett who has pursued Ignatova relentlessly, there are many unanswered questions about her connections to Ireland. “Vast sums of money passed through Ireland. It was a key component of Ruja’s money laundering system. We still don’t know exactly what happened, and how it managed to pass under the radar for so long.”
Further reading:
Ireland and the Cryptoqueen: how Irish investors lost millions on a currency scam