Police in the southern Russian city of Astrakhan have detained a man accused of defrauding people who wanted to purchase crypto miners. Law enforcement officials say the suspect made millions of rubles through fictitious sales of mining devices to Russian citizens and foreigners.
Investigators Claim Russia Made Money By Selling Any Crypto Mining Rigs
A resident of the Russian Republic of Tatarstan’s capital, Kazan, has been arrested in Astrakhan in southern Russia for defrauding 10 local residents and several foreigners who tried to buy mining equipment from him.
The Russian posted fake ads of crypto mining machines for sale and insisted on receiving the payments in advance. Law enforcement authorities have estimated he was able to collect around 19 million rubles this way (approx. $315,000).
“According to the investigation, the young man posted lucrative offers on the Internet for the sale of cryptocurrency mining equipment, which in fact he never owned. Now he is under Part 3 of Article 159 of the Criminal Code of the Russian Federation (Massive Fraud). is the defendant in a criminal case initiated under, “explained the local department of the Ministry of Internal Affairs in the Astrakhan region.
A press release detailed that the suspect promised his victims he would send them the crypto miners provided they pay him in full beforehand. One of the buyers transferred 936,000 rubles to the bank account of the seller, who broke all communication once he got the money. If found guilty in court, the fake mining hardware trader may get up to six years in prison.
Cases of fraud and theft related to crypto mining are on the rise in Russia, along with the growing popularity of the extraction of digital coins, as a profitable business for companies and as an alternative income source for many ordinary Russians. In June, mining equipment worth $1.9 million was stolen from a mining hotel in Irkutsk. And in July, masked men robbed a large crypto farm near Moscow.
Tatarstan, where the arrested fraudster comes from, became home to Russia’s largest Ponzi scheme in recent years. The Finiko pyramid lured investors from Russia, the former-Soviet space, Europe, and beyond with promises of extraordinarily high profits in return for the bitcoin they send to the phantom entity. According to a report by blockchain forensics firm Chainalysis, the scam received over $1.5 billion worth of BTC alone in just two years.
