Latvia is one of the smallest EU countries with less than 2 million inhabitants, but Latvians are world leaders in financial cybercrime. FinTelegram, for example, has uncovered dozens of scams of the so-called Latvian Racket in recent years. Many of them were run by UK companies. That was also the case with the Latvian Ivars Auzins, who was extradited to the U.S. on Friday on a six-count indictment charging him with crypto fraud schemes between 2017 and 2019.
As early as December 2021, the U.S. Securities and Exchange Commission (SEC) brought a fraud complaint against Ivars Auzins a/k/a Aivars Grauzdins, which provided the legal ground for the DOJ’s actions.
Auzins perpetrated a brazen scheme in which he fleeced investors who funneled millions of dollars into fraudulent cryptocurrency.
Breon Peace, United States Attorney for the Eastern District of New York
As alleged in the indictment, Auzins, using aliases to conceal his identity, operated a series of entities, the “Auzins Entities,” that advertised through email campaigns, social media, and websites dedicated to cryptocurrencies. The Auzins Entities purported to offer valuable crypto investment opportunities, solicited investments, and then effectively disappeared.
Some of the Auzins Entities purported to raise funds from investors through Initial Coin Offerings (ICOs) such as the Denaro initial coin offering (“ICO”). Other Auzins Entities – Impressio Estate Ltd., Broi Investments Ltd., also known as Bankroi, ChangePro Pty Ltd., Gemneon Investments Limited, and Lycovest Ltd. – purported to be crypto investment platforms that provided investors with different investment plans and profit rates. Another Auzins Entity purported to offer investments in mining several cryptocurrencies, including Bitcoin and Ether.
The Auzins Entities promised high returns and worked with fake identities. After soliciting investors in its ICO, Denaro stopped its public advertising campaign, its website became publicly inaccessible, and its investors lost their investments.
Between approximately November 2017 and July 2019, individuals in the United States and elsewhere transferred at least $7 million in digital assets to the Auzins Entities. Shortly after receiving these investments, the Auzins Entities disappeared without providing their promised services.
