Fighting cybercrime – Next trial in the ‘Wolf of Sofia’ Case starts!

E&G Bulgaria cybercrime case
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Israeli Gal Barak is a nice and funny guy in private. But yet his business is scams and online investment fraud. He was one of the cybercrime organization E&G Bulgaria principals and was sentenced to four years in prison by a court in September 2020. He was the Wolf of Sofia! Remarkably friendly sentencing given the alleged €200 million his victims’ losses amounts to. His Israeli lieutenants Tal-Jacki “Jacki” Fitelzon and Kfir Levy are currently in pre-trial detainment in Germany. The trial against “Jacki” will start on November 22, 2021, in Munich. Others will follow suit. Another update!

The Cybercrime Organization

Gal Barak and friends wanted from law enforecement

Prosecutors consider it proven beyond reasonable that Gal Barak with his wife Marina Barak (formerly Marina Andreeva), Jacki Fitelzon, and Kfir Levy had the operational leadership of the cybercrime organization E&G Bulgaria, which

  • operated the scam brands XTraderFX, OptionStarsGlobal, and SafeMarkets;
  • illegal boiler rooms in Bulgaria, Serbia, Bosnia Herzegowina, and Georgia;
  • maintained an international money-laundering network.

It is worth mentioning at this point that the German prosecutors continue to claim that Marina Barak was a member of the top leadership of the E&G Bulgaria cybercrime organization, although she was acquitted in Austria. Allegedly, the evidence was not sufficient for the court. The Austrian prosecutors appealed against the court sentence. The evidence against her is now likely to be much better in Germany.

Jacki Fitelzon adopted the stage name Ethan Fox and is said to have been the boss over all boiler rooms in Bulgarian, Serbian, and Bosnia Herzegovina. In addition, he is also said to be responsible for manipulations around the software used.

Jacki Fitelzon a/k/a Ethan Fox was arrested in July 2020 in Greece at Athens airport when he was on his way to Tel Aviv. In November, he was extradited to Germany, where he is in pre-trial detention. According to a letter from his lawyer, he intends to plead guilty to the charges and will apologize to the victims. However, he is said to have no money left to satisfy his victims. In addition, he is said to have had severe alcohol and drug problems. After the arrest of Gal Barak and the collapse of E&G Bulgaria, Fitelzon and the other lieutenants looked for interesting opportunities in the scam scene.

The Afterlife

At the time of his arrest, he worked for the CySEC-regulated investment firm Crowd Tech Ltd d/b/a Trade360 (www.trade360.com) and for the related UFX Global Ltd d/b/a UFX as a boiler room manager and consultant. From these companies, Fizelton received payments over several months from these CySEC-regulated brand operators to the bank account of his Bulgarian company I-ARE Consulting EOOD.

Fitelzon’s colleague Kfir Levy also stayed in the boiler room scene after the collapse of E&G Bulgaria. He was arrested in October 2021 on the initiative of the German authorities in the Philippines, where, to the knowledge of the authorities, he also worked for Israeli boiler rooms. His trial has not been scheduled at this time. It is expected to take place together with other trials in 2022.

The Wolf of Sofia and his people

So far, in addition to Gal Barak, several former Boiler Room agents of E&G Bulgaria have already been convicted in Germany.

Gal Barakprincipal E&G Bulgaria,
convicted to 4 years prison and restitution payments in Austria,
Germany wants to indict him too, but he appealed; the case is currently before the European Court of Justice
Israeli citizen, released on probation, currently in Israel
Gery Shalonalleged principal, suspect, and whistleblowerIsraeli-Georgian citizen, plead guilty to cybercrime activities in the U.S.
Vladislav Smirnovalleged principal, suspectRussian citizen
Ilan Tzoryaalleged principal, defendantIndictment filed
Marina Barakalleged accounting of E& G Bulgaria, acquitted in Austra but appealed by prosecutors, suspect in the German caseBulgarian citizen married Gal Barak, previously known as Marina Andreeva
Tal-Jacki Fitelzonalleged lieutenant and boiler room manager,
indicted for running a cybercrime organization to defraud consumers,
currently in pre-trial detainment in Germany
allegedly pleas guilty to the charges
trial starts on November 22 2021
Kfir Levyalleged lieutenant,
currently in pre-trial detainment in Germany
arrested in Oct 2021in the Philippines,
no trial date scheduled
Dominik Rauchboiler room agent, convicted to a 33-months prison termGerman citizen working in Sofia boiler room
Dimitar Moralyiskiboiler room agent with stage name James Morra, sentenced to a 54-months prison term, not yet effectiveBulgarian citizen
Paul Lopatinmoney-laundering guy, sentenced to 48 months in prisonGerman citizen facilitating E&G Bulgaria scam brands
Itzak GelletDeputy of Gal Barak and close friend,
Israeli citizen
Chen GanonBrand manager SafeMarkets in Serbia and Bosnia-Herzegowina,
Israeli citizen
Amit HulinLieutenant, boiler room manager Serbia
Israeli citizen
Maor SioniBoiler room manager Bulgaria
Israeli citizen
Barak SimhiBoiler room manager Georgia
Israeli citizen
Jesse TallyBoiler room manager
Israeli citizen

Currently, another dozen people (the names are available to FinTelegram) are under investigation in Germany, Austria, Serbia, and Bulgaria. Some may face charges. Some of these suspects have massively incriminated Gal Barak and his leadership team. For the investigations and indictments, the various prosecutors’ offices have formed a joint, multi-jurisdictional investigative group that closely exchanges information.

Related cases

Gery Shalon and his global cybercrime network

However, the law enforcement authorities in Europe are not only working on the E&G Bulgaria case. In the meantime, however, it has become a precedent for the fight against cybercrime in Austria. The authorities have gained a lot of experience and fed their databases through the multi-jurisdictional investigations in this case over the last three years. Most recently, 4 Israeli nationals were arrested in Tel Aviv at the request of German and Austrian authorities. They are part of the so-called GetFinancial Case (read report here). E&G Bulgaria did not run these scams, but partly the same people were involved in both cases and shared resources. According to information from an insider, Gery Shalon‘s brother-in-law, the Israeli lawyer David Bar-El is involved in this case. In any case, the trail of the money also leads to him.

Ultimately, the PandaTS Case is also at the center of the investigation. In August 2021, German law enforcement agents, with the support of the Israeli police, searched the offices of PandaTS and confiscated extensive data material. This case is again with another German prosecutor but again there are direct links to E&G Bulgaria and Gal Barak. Their scams XTraderFX and SafeMarkets were run on PandaTS. Gal Barak admitted in his confession that customer accounts and trades were manipulated via PandaTS. Jacki Fitelzon is also accused of manipulation directly through PandaTS. The international investigation teams are also cooperating very closely in this case.

It will be an exciting 2022.

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