Four founders of Forsage, a decentralized finance (DeFi) cryptocurrency investment platform, have been charged with running a Ponzi and pyramid scheme that raised around $340 million from victim-investors worldwide.
Russian nationals Vladimir Okhotnikov, Olena Oblamska, Mikhail Sergeev, and Sergey Maslakov are accused of promoting Forsage through social media as a legitimate business opportunity while operating it as a Ponzi and pyramid investment scheme.
According to court documents, the defendants allegedly coded and deployed smart contracts that systematized their combined Ponzi-Pyramid scheme on the Ethereum, Binance Smart Chain, and Tron blockchains.
Analysis of the computer code underlying Forsage’s smart contracts allegedly revealed that, as soon as an investor invested in Forsage by purchasing a “slot” in a Forsage smart contract, the smart contract automatically diverted the investor’s funds to other Forsage investors, such that earlier investors were paid with funds from later investors.
The defendants falsely promoted Forsage to the public as a legitimate, low-risk, and lucrative investment opportunity through the platform’s website and various social media platforms.
However, blockchain analytics confirmed that over 80% of Forsage investors received fewer ETH back than they had invested, with over 50% of investors never receiving a single payout.
The defendants coded at least one of Forsage’s accounts in a way that fraudulently siphoned investors’ funds out of the Forsage investment network and into cryptocurrency accounts under the founders’ control.
The FBI Portland Field Office, U.S. Postal Inspection Service (USPIS), and Homeland Security Investigations (HSI) New York’s El Dorado Task Force are investigating the case. If convicted, the defendants face a maximum penalty of 20 years in prison.
The Forsage scheme’s victims are encouraged to visit the webpage of the U.S. Department of Justice to identify themselves as potential victims and obtain more information on their rights, including the ability to submit a victim impact statement.
