US Opposes Early Release for OneCoin Money Launderer

News | April 29, 2024 By:

On Thursday, April 4, 2024, the United States government filed a motion opposing Gilbert Armenta’s request for compassionate release.

Armenta was convicted for his role in laundering over $300 million for the Bulgaria-based OneCoin cryptocurrency scheme. Prosecutors called OneCoin an international, multi-billion dollar pyramid and Ponzi scheme that defrauded millions of investors worldwide between 2014-2016.

OneCoin claimed to be similar to Bitcoin but was found to have no real value and no underlying technology. Leaders Ruja Ignatova and Sebastian Greenwood falsely marketed OneCoin as a cryptocurrency that would inevitably rise in price based on market demands, when in reality the value was arbitrarily inflated without relation to economic factors.

The new court filing from federal prosecutors outlines Armenta’s extensive money laundering operations that laundered over $300 million in fraudulent OneCoin profits over two years. He provided false documents to banks to disguise the criminal nature and origins of the funds transfers. Armenta also purchased luxurious assets like a private jet and multimillion-dollar homes with proceeds from the OneCoin scheme.

The motion states that when some investors began protesting at Armenta’s office after their money disappeared, he continued laundering hundreds of millions more for over a year. Armenta revealed to prosecutors after his arrest that he also laundered about $25-30 million from illegal online gambling activities in 2015-2017.

In addition, prosecutors say Armenta tried to extort $32 million back from a fellow money launderer who had stolen funds from him, hiring spies in the UK to threaten violence against the individual. Armenta only began cooperating with the US government’s investigation into OneCoin after his 2017 arrest.

The document opposes Armenta’s compassionate release request, arguing he has failed to prove extraordinary or compelling circumstances given his medical condition is being treated. It notes he only received a medical examination for his stated condition this March after filing the request in November 2023. Witnesses also testified at his 2023 sentencing about the severity of Armenta’s crimes and the need to deter criminal conduct and protect the public.

Prosecutors say Armenta should serve the full 60-month sentence handed down last year, having already committed further crimes in violation of his cooperation agreement after receiving leniency. They believe an early release would not adequately address the seriousness of Armenta’s money laundering offenses for the massive OneCoin cryptocurrency fraud.

Please contact BlockTribune for access to a copy of this filing.