Police in the southern Russian city of Astrakhan have arrested a man accused of defrauding people who wanted to buy crypto miners. Law enforcement officials said the suspect made millions of rubles in mining sales to Russian citizens and foreigners.
Investigators say they are selling Russian-made cashless crypto mining rigs
A resident of Kazan, the capital of the Republic of Tatarstan, was arrested in Astrakhan, southern Russia, for defrauding 10 local residents and several foreigners.
The Russian posted fake ads of crypto mining machines for sale and insisted on receiving payment first. Law enforcement authorities managed to collect about 19 million rubles in this way (approx. $ 315,000).
“According to the investigation, the young man posted tempting offers to sell crypto-mining equipment, which he had never posted on the Internet. Now he is charged with a criminal case under Article 159, Part 3 of the Criminal Code of the Russian Federation,” the local department of the Ministry of Internal Affairs of the Astrakhan region said.
In the press release, the suspect promised to send crypto miners to the victims if they paid in full in advance. One of the buyers transferred 936,000 rubles to the bank account of the seller, who cut off all relations as soon as he received the money. If found guilty in court, the fake mining hardware dealer could face up to six years in prison.
Issues of fraud and theft related to crypto mining are on the rise in Russia, along with the popularity of digital coin mining, a lucrative business for companies and an alternative source of income for many ordinary Russians. In June, miners worth $1.9 million were stolen from a mining hotel in Irkutsk. And in July, masked men robbed a large crypto farm near Moscow.
Tatarstan, where the arrested fraudster hails from, has become home to Russia’s largest Ponzi scheme in recent years. Phenico’s pyramid lured investors from Russia, the former-Soviet space, Europe and beyond, sending them into phantom bodies with the promise of extraordinarily high profits. According to a report by blockchain forensics firm Chinalysis, the scam netted more than $1.5 billion worth of BTC in just two years.
Do you expect to see a further increase in fraud cases related to cryptocurrencies and mining in Russia? Share your thoughts on the topic in the comment section below.
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