DeFi Ponzi: DOJ Indicts Forsage Founders in $340 Million Fraud Case

The US Department of Justice has issued a statement that a federal grand jury in the District of Oregon has returned an indictment charging the four founders of Forsage, a DeFi decentralized finance (DeFi) crypto investment platform, alleging a global Ponzi and pyramid scheme that raised around $340 million from investors.

Russian nationals Vladimir Okhotnikov, aka Lado; Olena Oblamska, aka Lola Ferrari; Mikhail Sergeev, aka Mike Mooney, aka Gleb, aka Gleb Million; and Sergey Maslakov, have been indicted for fraud.

Forsage was allegedly touted as a decentralized matrix project based on network marketing and “smart contracts,” which are self-executing contracts on the blockchain. The service was promoted on social media as a lucrative business opportunity, but the Feds claim that Forsage was a Ponzi and pyramid investment scheme that pilfered money from investors around the world.

Assistant Attorney General Kenneth A. Polite, Jr. of the Justice Department’s Criminal Division, said the department is committed to holding fraudsters accountable and this case highlights their ability to use tools to uncover sophisticated digital asset fraud.

U.S. Attorney Natalie Wight for the District of Oregon said they spent months piecing the theft together.

The DOJ explains that blockchain analytics confirmed that over 80% of Forsage investors received fewer ETH back than they had invested in Forsage’s Ethereum program, with over 50% of investors never receiving a single payout. Additionally, the defendants coded at least one of Forsage’s accounts (known as the “xGold” smart contract on the Ethereum blockchain) in a way that fraudulently siphoned investors’ funds out of the Forsage investment network and into cryptocurrency accounts under the founders’ control.

As further alleged in the indictment, the defendants falsely promoted Forsage to the public as a legitimate, low-risk, and lucrative investment opportunity through Forsage’s website and various social-media platforms. However,

“Technology is always changing and scams and swindles evolve alongside it,” said Inspector in Charge Eric Shen of the U.S. Postal Inspection Service (USPIS), Criminal Investigations Group. He added that individuals should be cautious when considering investments.

Okhotnikov, Oblamska, Sergeev, and Maslakov are each charged with conspiracy to commit wire fraud. If convicted, the defendants face a maximum penalty of 20 years in prison.

Victims of the Forsage scheme are encouraged to visit the webpage to identify themselves as potential victims and obtain more information on their rights as victims, including the ability to submit a victim impact statement.

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