The binary options and funds recovery fraudster Austin Smith, a dual US and Israeli citizen, was sentenced a year-and-a-day prison term on November 22, 2019. Additionally, Smith was ordered to almost half a million dollars restitution payments to the victims of the BinaryBook binary options scam he worked for as a boiler room manager.
The binary options schemes BinaryBook and BigOption were operated by the Israeli Yukom Communications Ltd and its partners such as the Israeli Numaris Communication Ltd. And Austin Smith was Vice President Sales of the latter and defrauded a lot of clients, the U.S. prosecutors claimed.
Simona Weinglass of The Times of Israel published a worth-reading detailed report on Smith’s background.
As part of his March plea deal, Smith provided testimony for the US government for the trial of Lee Elbaz, the former CEO of Yukom Communications. He testified against her, he told the court, in the hope of receiving a lighter sentence. He most likely will have provided more evidence for the indictment of Yossi Herzog und Kobi Cohen, the beneficial owners of the Yukom Scheme.
Stolen Client-Victim Data
In April 2016, Smith and friends stole the customer victim data from Numaris, his employer, and launched Wealth Recovery International (WRI). Smith admitted the theft in his testimony during the Elbaz trial.
The customer victim data stolen by Numaris was the basis for Smith’s funds’ (wealth) recovery scheme WRI which he later ran with his partner Tamar “Tami” Hamm until his arrest and plea agreement in 2019. Actually, WRI was a reverse-engineered binary options scheme based on aggressive sale tactics, stolen data, and a blackmailing approach.
WRI consequently used the stolen data to contact the customer victims – many of whom were previously his customer victims – and offered to repatriate the money he had stolen. The U.S. prosecutors have detailed this in the course of the Plea Agreement.
The prison sentence and restitution payments in Smith’s U.S. case, however, he primarily received because of his activity as a Numaris boiler room agent for the BinaryBook scam. However, his WRI activity was at least as bad and damaged many retail investors.
The Yossi Herzog testimony
FinTelegram spoke to Yossi Herzog a few months ago, the now-indicted beneficial owner behind the vast Yukom scheme (see chart above). He confirmed to FinTelegram that Smith had stolen the client-victim data and misappropriated the data for his WRI scheme. Therefore, Smith was threatened by Herzog with a million-dollar lawsuit in Israel. But in the end, an agreement was reached between Herzog and Smith.
The role of commercial lawyer Tami Hamm
Tamar “Tami” Hamm, Austin Smith’s partner in the WRI, is also well known to FinTelegram. Hamm and Smith visited the FinTelegram team in autumn 2018 and wanted data about Gal Barak and his platforms from FinTelegram. FinTelegram introduced them to Gal Barak‘s former Israeli partner, who already cooperated with FinTelegram and the EU authorities in this case. They later used blackmail to induce this former partner to release customer victim data.
The FinTelegram’s email communication and protocols, however, show that Tami Hamm was the driving force behind these dirty business practices. When FinTelegram asked WRI to refrain from these extortionate methods, EFRI/FinTelegram were called “naive” and even “anti-semitic”. Simply because we demanded to stop their illegal business approach. According to the latest report of Simona Weinglass, Tami Hamm started to distance herself from WRI and Austin Smith after his Plea Deal. From her LinkedIn profile, we can see that Tami Hamm left WRI to start as a commercial lawyer with the Israel law firm Hirsch-Falk & Co.
As a matter of fact, on September 25, 2019, an Israeli judge ordered that WRI Israel be liquidated. Actually, WRI was just a brand, a registered US company owned by Smith’s mother did the funds’ recovery business.
Her US lawyer said to The Times of Israel, that Hamm left WRI after taking notice of irregularities in the company’s business practices. She would rather cooperate with the U.S. Department of Justice to track down clients’ funds. That’s interesting.
Through our firm, proactive measures have been taken to share with US Department of Justice information regarding the location and amounts of funds advanced by Wealth Recovery International clients. Our client has diligently fought to maintain punctilious observance of her duties and has been compelled to endure significant personal and financial hardship navigating what might best be described as an otherworldly scheme and artifice which gave rise to the criminal proceedings being initiated against the former principal.Albert Watkins of Kodner Watkins, LC (Source: The Times of Israel)
Let’s call it the ‘Smith Approach’
Apparently, Hamm tries to position herself as a sort of WRI victim. Well, that’s quite understandable given the many “irregularities” that came to light over the last couple of months. Hamm evidently is following Smith’s approach of blaming the former partners for everything.
Hamm, however, was definitely not the naive partner of Austin Smith but was a driving force behind the WRI scheme. We’ve now learned that Hamm and Austin had their trip to the FinTelegram meeting paid for by an UFX-Victim who had asked WRI to recover the money they had stolen (no connection to Gal Barak at all). By the way WRI afterward started to blackmail the meeting’s participants.
As a matter of fact, WRI operated a large call center (boiler room) in Israel. Its agents cold-called the victims of binary options Scams and aggressively persuaded them to mandate WRI to recover their funds. It was never mentioned that Austin Smith was one of the former binary options scammers. Like those binary options scammers, the agents of the WRI boiler room cold-called and spammed the customer victims without the respective client-agreement. They also used stolen client-victim data and blackmailed people to receive additional data.
As with the binary options, new WRI clients had to advance thousands of dollars right from the start to receive basic information. And many naive clients did that. WRI then contacted the mostly Israeli scammers and blackmailed them for recovery payments. Sometimes, this approach worked and WRI took big commissions. FinTelegram documented and experienced this approach extensively well.
Austin Smith’s prison sentence should only be the beginning of the WRI-scam processing. The authorities should also take a closer look at Tamar Hamm aka Tami Hamm’s actions. While FinTelegram is not claiming that Hamm, a citizen of the US and Israel, violated the law in Israel, and North America, we claim that Tami Hamm violated for sure the Data Protection Rules in Europe. So we consider the WRI scheme worth to be extensively investigated by the respective authorities.