Huge online trading fraud: Investors damaged by 100 million euros

Several hundred interrogations and 50 account openings in Germany and abroad were carried out. Thousands of Austrians ripped off.

The Central Public Prosecutor’s Office for the Prosecution of Commercial Criminal Matters and Corruption (WKSTA) conducts numerous investigations against international groups of perpetrators, which a large number of private investors in total in connection with so-called “cyber trading fraud” or fraud through alleged investments in binary options, cryptocurrencies and similar financial products Have damaged millions.

According to its own information, the WKStA “took over an investigation, initially led by the Feldkirch public prosecutor since 2017, against an international group of perpetrators with a corporate structure, who have harmed several thousand people across Europe by more than 100 million euros via online trading platforms for binary options and cryptocurrencies “.

The WKStA has set up an investigation team made up of two senior public prosecutors and a team leader to conduct the complex, large-scale proceedings quickly and efficiently. The extensive investigations include suspected serious fraud and money laundering and affect a total of 18 people.

Opened around 50 accounts in five countries

In close cooperation with the State Criminal Police Office (LKA) of Lower Austria and the Federal Criminal Police Office (BKA) and after the formation of a Joint Investigation Team (JIT) with the Central Office of Cybercrime Bavaria established at the Public Prosecutor’s Office in Bamberg and the Public Prosecutor’s Office in Saarbrücken as well as with the support of the Special Public Prosecutor’s Offices in Bulgaria, the WKStA has and Serbia and with the support of Eurojust and Europol carried out a total of around 20 house searches and seizures in several Europe-wide actions in five countries around 50 account openings. In addition, several hundred interrogations were carried out.

Two million euros secured

“This enabled several terabytes of data, as well as business documents in paper form, some of which are still being evaluated, and around two million euros to be secured”. it continues.

“One of the alleged main perpetrators, an Israeli national, has been in custody since the beginning of December 2019 after he was handed over by the Bulgarian law enforcement authorities after the execution of a European arrest warrant issued by the Austrian judiciary,” said the WKStA.

The main perpetrator is an Israeli citizen

One of the alleged main perpetrators, Gal B., an Israeli national, had been in custody since the beginning of December 2019 after he was handed over by the Bulgarian law enforcement authorities after the execution of a European arrest warrant issued by the Austrian judiciary.

Further investigations are ongoing against Gal B. in Austria, Germany, Switzerland and England. Worldwide, with the focus on Europe, the damage is likely to amount to more than 100 million euros.

Dozens of mailbox companies

As early as May 2020, the WKStA was able to bring the first indictment against the perpetrator Gal B., accusing him of harming a total of more than a thousand Austrian victims. The total damage is around 2.5 million euros. The Regional Court for Criminal Matters in Vienna sentenced B. to four years imprisonment for fraud and money laundering on September 1, 2020.

The defendant is a Bulgarian national

In June 2020, the WKStA brought another indictment against the “financially responsible person” of the group of perpetrators at the Regional Court for Criminal Matters in Vienna, on the basis of essentially identical facts.

According to the WKStA, the defendant, a Bulgarian national, was “largely responsible for the organization of the extensive money laundering network with dozens of mailbox companies in well-known offshore destinations such as the British Virgin Islands, the Seychelles and Samoa”.

Another main culprit is a German

Another alleged main perpetrator, a German national, was handed over to the German authorities for prosecution in October 2019 after his arrest in Austria in January 2019. Currently, around 14 suspects are still being investigated in Austria. According to the current state of investigation, the number of victims is in the four-digit range.

The exact amounts of damage are still the subject of the investigation, however, the amount of damage affecting the Austrian law enforcement authorities of up to around nine million euros can currently be assumed. The money laundering investigations are also linked to this.

Changing operating companies

The background to the investigations is essentially what are known as trading or cybertrading platforms, which cause high financial losses for private investors.

“The international group of perpetrators set up an elaborate, group-like structure with brand generation, software development, public relations, in particular in connection with advertising and control of reporting, affiliate support and call centers,” it said in a broadcast.

“The perpetrators’ approach regularly follows a similar pattern: By means of regularly changing operating companies, unlicensed online trading platforms are created under various domain or brand names (xTraderFX, OptionStars / OptionStarsGlobal, GoldenMarkets, SafeMarkets, option888, zoomtrader, xmarkets, tradeinvest90) for the – merely pretended – trading in binary options, contracts for difference and comparable highly speculative financial instruments. “

The scam

Investors across Europe are encouraged to register and pay an amount of 250 euros via advertising banners or mass emails on the platform by promising above-average profits.

According to investigators, the investors are then contacted directly by a specially trained trading specialist (so-called agent or broker) posing as a broker via telephone, messenger services or e-mail and by announcing higher profits to transfer additional amounts to various accounts or to authorize the withdrawal of additional amounts from their credit card accounts “.

Perpetrators run call centers

And it goes on to say: “For this purpose, the perpetrator groups operate call centers abroad, in which dozens of people with the necessary foreign language skills operate under aliases. As a result, the investors conduct further business deals under the guidance of the alleged broker and the positive outcomes of these business deals suggested to them on the website and the previous profit promises of the brokers tempted them to pay further amounts or, in some cases, pushed them by the brokers.

“The attempt to obtain the payment of the supposedly negotiated capital leads – as well as the refusal of further payments – in all cases to a break in contact and the failure to pay out”, it says in the broadcast. According to some website expert in binary options trading, the use of call centers is a clear sign of a scam.

70 companies and bogus managing directors
“After the customers transfer the money, the responsible” brokers “simulate trading in financial instruments for their customers. , so the WKStA.

In fact, the presented charts can be manipulated by the perpetrators using specially developed software, according to the public prosecutor.

Alleged trades lead to total loss

And it goes on to say: “In a large number of cases, after individual (alleged) trades that go wrong, there is a total loss of the capital employed.

At the end of the day, the payment flows and actual shareholdings / ownership structures are concealed “via a global network of around 70 companies and sham managing directors, who are currently known by name, as well as constantly changing platforms and operating companies”.