Leader of Suspected Russian Ponzi Scheme Is Arrested in UAE: Report
Interpol arrested Edvard Sabirov, one of the top figures in the Finiko investment fund that is said to have swindled about $95 million from investors in Russia and was identified by the central bank as having "signs of a Ponzi scheme,” RIA Novosti news agency reported on Thursday.
Sabirov was arrested in the United Arab Emirates. Russia’s general prosecutor’s office has already requested his extradition to face criminal charges for fraud, according to the report. He had been on the wanted list since Nov. 12, and was apprehended Nov. 30. Earlier in the month, co-founder Zygmunt Zygmuntovich was also arrested in the UAE, and Russia is pursuing his extradition as well, according to RIA Novosti.
Finiko was popular in Russia in 2020-2021, marketing itself as a crypto investment fund. The company, which had been conducting public events and openly advertising itself, operated as a multilevel marketing scheme, offering rewards for bringing in new users and targeting mostly women from 30 to 50 years old, according to the Russian investigative outlet The Bell. It could have gotten away with as much as $95 million of investors’ money, The Bell said.
In summer 2021, Finiko froze bitcoin withdrawals on its website, allowing users to withdraw only the fund's native token, FNK, which immediately plunged in price by 97%. According to Crystal Blockchain, at the time of the crash Finiko’s crypto wallets contained 1.8 million USDC, 111.3 million USDT and 888 ETH, as well as 110 million FNK tokens.
Sabirov's arrest leaves just one of Finiko's known leaders at large, Marat Sabirov, who is not related to Edvard. Kirill Doronin was arrested in Russia in July, despite obtaining Turkish citizenship under the name Onur Namik.
Russian serial crypto entrepreneur Sergey Mendeleev told CoinDesk last year that in January 2021, Finiko has been cashing out massive amounts of crypto, sending Moscow's over-the-counter crypto market into a frenzy.
