Damian Williams

OneCoin head of compliance facing 40-year sentence after US extradition

The alleged fraudster was accused of doing the “exact opposite” of her job title, which was to ensure OneCoin was complying with laws.

United States federal prosecutors have charged a former executive of the fraudulent cryptocurrency scheme OneCoin for her role in the operation. Irina Dilkinska now faces up to 40 years in prison after being extradited from Bulgaria.

On March 21, the Department of Justice charged Dilkinska — OneCoin’s former head of legal and compliance — with one count of wire fraud and one count of conspiracy to commit money laundering. Each count carries a maximum potential sentence of 20 years in prison.

Dilkinska allegedly aided in laundering over $400 million of OneCoin’s proceeds, and upon hearing of a co-conspirator’s arrest destroyed incriminating evidence and sent incriminating messages.

U.S. Attorney Damian Williams pointed out the irony in Dilikinska’s job title given the nature of OneCoin, saying:

“Irina Dilkinska, the supposed Head of Legal and Compliance for the OneCoin cryptocurrency pyramid scheme, accomplished the exact opposite of her job title and allegedly enabled OneCoin to launder millions of dollars of illegal proceeds through shell companies.”

The announcement said Dilkinska was extradited from Bulgaria on March 20 and was set to appear before U.S. Magistrate Judge Sarah Netburn the following day.

OneCoin was founded in 2014 by “cryptoqueen” Ruja Ignatova and Karl Sebastian Greenwood, with the latter facing up to 60 years in prison after pleading guilty in December to multiple charges.

Related: DOJ and SEC to probe SVB collapse and insider stock sales: Report

Ignatova, however, has managed to evade law enforcement agencies, going missing in October 2017 after a flight to Greece just 15 days after a federal warrant was issued for her arrest.

In June 2022, Ignatova was added to the Federal Bureau of Investigation’s Top Ten Most Wanted List, and a $100,000 reward is offered for information leading to her arrest.

OneCoin was exposed as a scam back in 2015 but managed to generate over $4.3 billion in revenue, with profits of nearly $3 billion between Q4 2014 and Q4 2016 alone.

Related: Best and worst countries for crypto taxes — plus crypto tax tips

Sam Bankman-Fried may no longer be allowed to play League of Legends

Sam Bankman-Fried is, for the most part, still able to freely access the internet through various devices. Prosecutors want to change that.

Sam Bankman-Fried, the former CEO of crypto exchange FTX, may no longer be able to play League of Legends and other video games if newly proposed changes to his bail conditions from United States prosecutors are approved.

In a Feb. 15 letter to United States District Judge Lewis Kaplan, U.S. Attorney Damian Williams asked the court to further expand restrictions surrounding Bankman-Fried’s electronic device usage.

They pointed to Bankman-Fried’s recent device usage as cause for concern, and agreed with the court’s intuition that it was “shortsighted” to focus only on restricting the use of apps, adding:

“There is now a record before the Court of a defendant who appears motivated to circumvent monitoring and find loopholes in existing bail conditions. The appropriate course, therefore, is broader restrictions on the defendant’s cellphone, tablet, computer, and internet usage, with limited exceptions.”

The prosecutors propose that Bankman-Fried should be prohibited from using cellphones, tablets, computers, or the internet, except for very limited uses such as reviewing pre-trial evidence, communicating with lawyers and accessing emails.

He would be restricted to using a single computer and cell phone, which in addition to his Gmail account would be monitored using a “pen register” — a device or process that essentially produces a list of phone numbers of internet addresses contacted from a specific source.

Bankman-Fried is understood to be an avid gamer, having reportedly played online video games such as League of Legends during fundraising rounds while at FTX. 

Bankman-Fried also mentioned during an interview with New York Times on Nov. 13 that he likes to play games, as it helps him “unwind a bit” and clear his mind.

Under the newly proposed bail conditions, it appears that Bankman-Fried will no longer be allowed to partake in the activity.

Related: Judge allows release of identities of guarantors behind Sam Bankman-Fried’s bail

Earlier this month, the former CEO was prohibited from using encrypted messaging apps after he was found to have contacted potential witnesses in his criminal case.

He has also been temporarily banned from using VPNs on Feb. 14, after the Justice Department discovered he had used a VPN on two different occasions — in order to watch sports coverage. This ban will be further discussed during a Feb. 16 hearing.

Many from the crypto community were disgusted by the initial conditions of Bankman-Fried’s bail, which required him to wear an ankle bracelet but afforded him full computer and internet access from his parents luxurious home in sunny California.


US Feds put together ‘FTX task force’ to trace stolen user funds

United States Attorney Damian Williams said the office is working “around the clock” to respond to the implosion of FTX.

The United States Attorney’s Office for the Southern District of New York (SDNY) has formed the FTX Task Force to “trace and recover” missing customer funds, as well as handle investigations and prosecutions related to the exchange’s collapse. 

The announcement came in a statement from U.S. Attorney Damian Williams, who is the federal prosecutor in the FTX case involving founder Sam Bankman-Fried.

Charges from the Manhattan attorney’s office against Bankman-Fried include wire and securities fraud, conspiracy to commit wire and securities fraud, money laundering and violation of campaign finance laws.

“The Southern District of New York is working around the clock to respond to the implosion of FTX,” said Williams in the statement, adding:

“It’s an all-hands-on-deck-moment.”

“We are launching the SDNY FTX Task Force to ensure that this urgent work continues, powered by all of SDNY’s resources and expertise until justice is done.”

According to the SDNY, the task force’s team consists of senior prosecutors from its securities and commodities fraud, public corruption, money laundering and transnational crime enterprise units — which will be responsible for the “investigation and prosecution of matters related to the FTX collapse.”

Meanwhile, its “asset forfeiture and cyber capabilities” will be used to “trace and recover” the billions of dollars worth of missing customer funds, it added.

A similar effort had already been underway by FTX’s new management, which hired financial advisory company AlixPartners in December to conduct “asset-tracing” for FTX’s missing digital assets.

Related: Sam Bankman-Fried enters not guilty plea for all counts in federal court

The Manhattan U.S. Attorney’s Office reportedly first began its probe of FTX’s collapse shortly after the firm filed for bankruptcy on Nov. 11.

According to its website, the U.S. Attorney’s Office for the Southern District of New York is known for prosecuting cases involving the violation of federal laws and investigates a broad array of criminal conduct “even when the conduct arises in distant places.”

FTX and key executives including Bankman-Fried, co-founder Gary Wang and Alameda Research former CEO Caroline Ellison had since September 2021 been operating out of the Bahamas,  where many of the alleged crimes are believed to have been perpetrated.

On Jan. 3, Bankman-Fried pleaded “not guilty” to all eight criminal charges related to FTX’s implosion — which carries a total of 115 years of prison for the FTX founder if he is convicted.

Last month, Wang and Ellison pleaded guilty to federal fraud charges relating to their role in the collapse of the FTX exchange.