Investors defrauded by Russia-based cryptocurrency Ponzi scheme Finiko sent the crypto pyramid an average of over 720,000 rubles, or over $ 10,000 at current exchange rates. The assessment comes from a survey of victims conducted by a public not-for-profit organization.
Fifth of Finiko’s investors part with more than one million rubles
Russia is still trying to grasp the scale of its biggest financial scam since the infamous MMM pyramid in the 1990s. While the officially recorded losses for Finiko reached 1 billion rubles (nearly $ 14 million), some estimates suggest that the total should exceed $ 4 billion. According to Chainalysis, the Ponzi scheme received more than $ 1.5 billion worth of bitcoin in less than two years.
Citizens of Russia, Ukraine and other countries in the former Soviet space, EU member states and the United States are among those who sent 800,000 separate deposits to Finiko. Around 3,300 of the victims have been identified so far, but the actual number is likely much higher. Due to the scale of the fraud, the Interior Ministry in Moscow has taken over the investigation from law enforcement in Tatarstan, where Finiko was based and several of its key members have been arrested.
About 200 of the defrauded investors filed complaints with the Federal Foundation for the Protection of Investor and Shareholder Rights, a public non-profit organization in Russia, local media reported. Marat Safiulin, director of the foundation, told the economic information portal Ufatime.ru that 154 of them were asked by phone about their investments.
Based on their comments, the foundation established that the average financial loss per investor is 724,000 Russian rubles (over $ 10,000). About 22% of investors lost more than one million rubles (nearly $ 14,000) and 73% sent Finiko at least 300,000 rubles each (over $ 4,000). More than half of the victims surveyed took out loans to invest in the Ponzi scheme.
Finiko, which was never incorporated, presented itself as an “automatic profit generation system”. The pyramid offered people enticing profits if they sent their money, which it promised to spend on crypto investments and share the profits with them. Investors have been told they can use the fast and high yields of up to 30% to cover a loan, buy a car or property at reduced prices, or withdraw cash when needed.
The offices of Finiko in the capital of Tatarstan, the city of Kazan, were raided for the first time in December 2020. Its activities were marked by the Central Bank of Russia as showing signs of a pyramid scheme in June of this year. Despite this, the scam continued to attract new investors.
The Ponzi scheme stopped making payments in July and finally collapsed. Authorities in the Russian Republic of Tatarstan have so far arrested a number of top Finiko officials, including pyramid founder Kirill Doronin, two of his vice presidents Ilgiz Shakirov and Dina Gabdullina, as well as Lilia Nurieva. , which rose to the rank of so-called “10th star”. International arrest warrants have been issued for three of Doronin’s associates, Zygmunt Zygmuntovich, and Marat and Edward Sabirov, who managed to leave the Russian Federation before the investigation was launched in July.
Do you think the average amount lost by Finiko investors will increase as more and more victims of the Ponzi scheme are identified overseas?
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