• Four Russian founders have been indicted by a federal grand jury in the District of Oregon for their key roles in an alleged $340 million “global Ponzi” scheme called Forsage.
• Forsage had touted itself as a low-risk decentralized finance platform built on the Ethereum blockchain that allowed users to generate long-term passive income.
• An analysis of the smart contracts revealed that funds raised were diverted to older investors, which is consistent with a Ponzi scheme.
Forsage Founders Indicted Over $340M DeFi ‚Ponzi Scheme‘
The Department of Justice has announced that four Russian founders behind the alleged $340 million „global Ponzi“ scheme Forsage have been indicted by a federal grand jury in the District of Oregon. U.S Attorney Natalie Wight for the District of Oregon said that bringing charges against foreign actors who used new technology to commit fraud in an emerging financial market was only possible with full and complete coordination from multiple law enforcement agencies.
What is Forsage?
Forsage had touted itself as a low-risk decentralized finance platform built on the Ethereum blockchain that allowed users to generate long-term passive income. It was designed with smart contracts coded in ways consistent with a Ponzi scheme, according to the Department of Justice.
Analysis Reveals Fraudulent Activity
An analysis of Forsage’s smart contracts revealed that funds raised as new investors purchased slots in its smart contracts were diverted to older investors, which is consistent with a „Ponzi scheme“. The victims invested approximately $340 million into this fraudulent activity and have lost much or all of their money due to these schemes.
U.S Attorney Makes Statement
U.S Attorney Natalie Wight for the District of Oregon stated: „Today’s indictment is the result of a rigorous investigation that spent months piecing together the systematic theft of hundreds of millions of dollars.“ She also added: „Bringing charges against foreign actors who used new technology to commit fraud in an emerging financial market is a complicated endeavor only possible with the full and complete coordination from multiple law enforcement agencies.“
Conclusion
The four Russian founders behind Forsage are facing federal charges for their involvement in this global Ponzi scheme where victims invested approximately $340 million dollars and likely lost most if not all their money due to these fraudulent activities which were revealed through an analysis done by multiple law enforcement agencies working together.