It was another interesting and moving week for the international fight against cybercrime. The U.S. authorities indicted five men for operating the BitClub Network crypto Ponzi scheme that allegedly defrauded investors by $722 million. Four of them were arrested, the U.S. Department of Justice announced on Dec 10, 2019. One of the defendants is at large and hence the U.S. authorities have not yet disclosed his identity. Rumors say that the fifth defendant may be the US citizen Russ Medlin.
BitClub follows OneCoin
The BitClub Network scheme was after the Bulgarian OneCoin of Ruja Ignavota one of the largest and most aggressive crypto Ponzi schemes of the last years. While OneCoin is said to have stolen over $4 billion from investors, U.S. prosecutors estimate the damage to the BitClub Network at $722 million.
Matthew Brent Goettsche, 37, of Lafayette, Colorado, and Jobadiah Sinclair Weeks, 38, of Arvada, Colorado, and Silviu Catalin Balaci are charged by indictment with conspiracy to commit wire fraud. Furthermore, they are charged by indictment with conspiracy to offer and sell unregistered securities. Goettsche was arrested in Colorado, Weeks in Florida, Abel in California, and Balaci was arrested in Germany. All three are scheduled to have their initial appearances in the districts of their arrests. One defendant remains at large and his identity remains under seal.
In the MLM and crypto scene, US citizen Russ Medlin is considered one of the founders and masterminds behind the BitClub Network. In a video (see here on FinTelegram) Medlin publicly reported in mid-2018 that the BitClub Network already has more than 1 million members worldwide. He may or may not be the fifth defendant, at least Medlin was the face of the BitClub in the years of its existence.
Joerg Witke in Germany
In Germany, Austria and Switzerland MLM veteran, Joerg Wittke was one of the driving forces behind the Crypto Ponzi scheme (read FinTelegram report here). FinTelegram has already reported about this several times in 2018. The current indictment and arrest bring down one of the largest Crypto Ponzi Schemas after OneCoin. This is good news in the fight against cybercrime.