The Israeli Lee Elbaz is a perpetrator but also a victim. As former CEO of the Israeli binary options scam entity Yukom Communications, she was found guilty of binary options fraud by a U.S. jury. The court sentenced her to 22 years in prison and $28 million in restitution payments. Elbaz is a victim of her greed and wrong judgments in the first place. But for sure she is the victim of her 20 years older mentor Yossi Herzog, a notorious forex veteran, and the schemes owner, principal as well as its mastermind. He is also charged by U.S. prosecutors but remains at large. He needs to stand trial to find justice for the victims.
The Court Orders
On August 7, 2019, Lee Elbaz was convicted of one count of conspiracy to commit wire fraud and three counts of wire fraud. In December 2019, the Court sentenced Elbaz to a 22-prison-term to be followed by three years of supervised release. On August 7, 2020, the Court ordered she will have to pay restitution of $28 million to victims of the scam.
The U.S. prosecutors established a well-grounded calculation that suggested that the total loss for Yukom Scheme investors attributable to Elbaz is over $106 million. Out of an abundance of caution the prosecutors, however, only sought a restitution amount of $28 million.
At this point, it must be noted that the U.S. prosecutors have not accused all fraud brands of the Yukom Scheme. Therefore the actual fraud volume is much higher. The U.S. prosecutors have focused primarily on the activities and victims of Yukom in the Unites States. However, the Yukom Scheme has also operated in Europe, Australia, and Asia.
The master and his apprentice
Yukom Communications Ltd is an Israeli company and was the operator of large fraudulent binary options brands such as BigOption, BinaryBook, or BinaryOnline. Elbaz was held responsible by the jury for the losses in the period May 2014 to June 2017. Lee Elbaz was the CEO and therefore undoubtedly responsible for the fraud. But she was not the principal of the Yukom scheme. According to current knowledge, this was her mentor Yossi Herzog, who was born in 1965 and thus some two decades her senior, and his partner Kobi Cohen. They were also the ultimate beneficial owners (UBO) behind the scheme.
Moreover, although we call it Yukom Scheme, the Israeli Yukom Communications Ltd was only one of three companies involved in the scam. The other two were Linkopia Mauritius Ltd (Mauritius) and Numaris Communication Ltd (Israel). Herzog and Cohen had control of all three companies.
Elbaz had worked as an apprentice with Yossi Herzog before Yukom and learned her “trade” in the 4XP scheme together with Roy Almagor. Bad enough! 4XP was has been a network of pre-binary options forex brands that have been exposed as scams. Elbaz learned the forex scam approach from Herzog and was most certainly coined accordingly. This does not make her innocent, for sure not, but it explains her behavior. In the Yukom Scheme, she was an obedient and dangerous deputy of Herzog and Cohen. The latter two, as principals of the Yukom Scheme, are responsible for the total damage to investors in the estimated amount of about $150 million.
But first these Yukom principals must be found and extradited to the United States.