OmegaPro Founders Slammed in $650M Crypto Fraud Case—Here’s What Went Down
Crypto's latest 'global fraud scheme' just got a $650 million price tag—and a spotlight.
The Pitchforks Are Out
Regulators dropped the hammer on OmegaPro's brass, alleging a sprawling crypto con that siphoned funds from hopeful investors worldwide. No fancy jargon—just old-school deception wrapped in blockchain buzzwords.
Follow the Money (Straight to the Bahamas?)
The numbers don’t lie: $650 million vanished faster than a Bitcoin maximalist’s patience during a bear market. Sources hint at offshore accounts, flashy lifestyle posts, and the classic ‘too-good-to-be-true’ returns that somehow still hook fresh money.
Why This One Stings
Another day, another rug pull—but this one had layers. Multi-level marketing meets unregistered securities, with a side of influencer hype. The SEC’s filing reads like a how-not-to guide for crypto ‘visionaries.’
The Aftermath
Lawyers are circling. Twitter’s divided between ‘I told you so’ and ‘this is FUD.’ Meanwhile, that one guy on YouTube still insists it’s all a misunderstanding.
Wake-up call or white noise? In crypto, the line’s thinner than a stablecoin’s backing. *Cue the usual ‘do your own research’ disclaimers—because clearly, that worked out great.*
“Too good to be true”
Karan Pujara, founder of the scam defense platform ScamBuzzer, told Decrypt that crypto MLM scams exploit powerful psychological triggers.
"Even if something is too good to be true, many fall for it," Pujara said, noting that "these scams based on false hope and high returns have been running for many years and may continue.” He added that, “The only thing that changes is the face of the scammer, who is greedy enough to steal, and the victim, who is greedy enough to YOLO their life savings."
Pujara noted there's "a very thin line between right and wrong" when it comes to high-profile influencers who participate in such schemes.
OmegaPro's unraveling
The alleged OmegaPro scheme began unraveling in November 2022 when the firm disabled withdrawals, claiming technical issues.
Affiliates began reporting being locked out of their accounts around November 7th, with withdrawal problems escalating by November 20th, according to a report by BehindMLM, an MLM review site.
Despite assurances from Reynoso and others in January 2023 that investments were secure and being transferred to a new platform called Broker Group, victims were unable to access their funds from either platform, the report said.
The platform received regulatory fraud warnings from multiple jurisdictions, including France, Belgium, Spain, and Peru, before its collapse in July 2023.
The duo’s indictment follows the arrest of co-founder Andreas Szakacs in Istanbul last year after a Dutch whistleblower representing 3,000 defrauded investors alerted Turkish authorities, as per a local media report.
Turkish authorities believe the platform's funds were linked to the infamous OneCoin crypto fraud that swindled investors of $4 billion in 2017.
"Based on previous hack and scam cases, the chances of recovering assets are very rare," Pujara said, adding that scammers avoid traditional exchanges and use fake KYC details from other countries.
If convicted, Sims and Reynoso each face a maximum penalty of 20 years in prison on each count.
Just last month, crypto market maker Gotbit and its founder were sentenced for using wash trading to inflate token volumes.
Founder Aleksei Andriunin received a reduced sentence after pleading guilty, forfeiting $23 million in crypto.
