A group of convicted Austrian fraudsters cleverly orchestrated a massive crypto scam to fund their opulent lifestyles. Their extravagant purchases included a villa, a luxury car, travels via private jet, and even a shark tank, as well as nights spent at exclusive club parties. The Austrian news outlet, Heute, reported on October 23 that approximately 40,000 individuals fell victim to this scheme, accumulating a staggering $21.6 million (equivalent to 20 million euros) from the fraudulent operation.
Unraveling the Crypto Scam: Fraudsters Brought to Justice
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The fraudulent investment scheme primarily revolved around investments in the EXW Wallet, along with EXW crypto tokens and real estate projects. The EXW platform promised investors enticing daily returns ranging from 0.1% to 0.32%, which effectively captivated the interest of many investors. However, after its inception in 2019, the EXW Wallet began showing signs of failure by 2020, raising suspicions among authorities. In September 2023, eight individuals were charged with money laundering, operating a pyramid scheme, and engaging in commercial fraud.
By October 23, the Klagenfurt Regional Court had delivered its verdict, convicting five of the accused fraudsters. Two received five-year prison sentences without the possibility of parole, while two others were sentenced to 30 months. Another defendant received an 18-month sentence, while five individuals were acquitted. Previous convictions for three of the defendants were considered during sentencing, and there are reports that some of the convicted individuals are planning to appeal their sentences.
Complex Investigations and Further Allegations
Labeled as “Austria’s biggest fraud trial” by Heute, the investigation spanned over a year, involving 60 days in court, 300 hours of negotiations, and 3,000 case files. Prosecutor Caroline Czedik-Eysenberg highlighted the intricate nature of the scam, noting its operations across multiple countries, some of which lack extradition treaties, such as the UAE.
The fraudsters went to great lengths to obscure their financial trails, utilizing encrypted communication channels like Telegram and enlisting expert companies to assist in evading detection. Some even resorted to carrying funds in plastic bags to Austria, further complicating the investigation. Czedik-Eysenberg described the scheme as never having any genuine intention of pursuing profitable projects, with initial promises made solely to lure unsuspecting victims. Defense attorneys argued that some of the defendants lost control as the scheme expanded beyond their management capabilities.
In addition to these charges, separate allegations have emerged regarding a cannabis-related fraud, where it is estimated that $17.2 million (approximately 16 million euros) was stolen from over 17,000 individuals. This adds another layer of complexity to the ongoing legal proceedings against the accused.
