Cold Case Review: With the ruling of a U.S. court in the case surrounding the PornHub and MindGeek child porn and sex trafficking scandal, it makes sense to take a fresh look at the old Binary Options cases. The court (report here) found that VISA, as a facilitator for PornHub, should have been well aware of the illegality of its customers’ activities and, therefore, could be partly responsible for the merchants’ criminal activities. With this in mind, over the next few weeks we will again take a closer look at our cold cases from the binary options era of 2012 to 2018, highlighting the role of payment processors.
It is a cold case now but still not resolved! Between 2018 and 2020, FinTelegram exposed that a group of Israeli payment processors controlled by Eyal Nachum and his partner Tamir Zoltovsky facilitated binary options and broker scams big style. They worked with entities in Montenegro or the Marshall Islands and with the regulated e-Money Institutions Bruc Bond (previously Moneta International) and International FinTech. In April 2020, the Bank of Lithuania revoked Bruc Bond‘s EMI license; consequently, the group vanished from Europe, but their scam-facilitating activities remain to be investigated.
Scams, Money Laundering, and God
Between 2018 and 2020, FinTelegram alerted the Bank of Lithuania about the activities of Bruc Bond and International FinTech. Eyal Nachum and Tamir Zoltovski filed defamation lawsuits in Israel against FinTelegram.
In their lawsuit against FinTelegram, Nachum and Zoltovski have accused FinTelegram of being potentially anti-Semitic and swore on God (“heaven forbid”) that neither they nor their companies would be involved in any scams or even money laundering. A was old lie uncovered by the Lithuanian regulator. Turned out, God did not cover their lies. Thus, the Bank of Lithuania revoked the company’s EMI license in April 2020 due to serious and systematic violations of compliance rules, maladministration, problems with money laundering, and provision of services exceeding the scope of the license.
However, the Bank of Lithuania actually fully confirmed the reports and turned the alleged defamation into a proven fact.
The New Asian Business
Bruc Bond disappeared from the EU and flew to Asia. Bruc Bond Pte Ltd operates as a MAS licensed Payment Services Provider with Unique Entity Number: 201818626Z in Singapore and provides cross-border money transfer services. Any reference to their former European activities is missing. Officially, neither Eyal Nachum nor Tamir Zoltovski has any executive function at the Asian Bruc Bond. On their LinkedIn account, Nachum (LinkedIn) and Zoltoviski (LinkedIn) state that they are board members at the firm.
The Cold Cases Review
Justice is known to work very slowly. In this respect, it is not surprising that court cases against binary options schemes from 2014 to 2018 are still ongoing at the moment. The Israeli-Canadian Cartu Brothers – David Cartu, Jonathan Cartu, and Joshua Cartu – have just recently received their million-dollar fine from the Canadian OSC for running fraudulent Binary Options schemes between 2013 and 2017 (report here). The U.S. regulator CFTC‘s fraud lawsuit is still ongoing in this matter.
Charges and lawsuits against former binary options scammers and boiler room operators are currently underway in Germany and other jurisdictions where the fraud happened years ago. When prosecuting online scams, special attention must be paid to the payment processors involved, without whose facilitation the fraud would not have been possible in the first place.
With the recent ruling by a U.S. court on VISA‘s responsibility as a payment facilitator in the child porn and sex trafficking scandal surrounding PornHub and MindGeek, the discourse around the responsibility of payment processors for illegal activities of their customers is gaining new momentum. The right time to open the cold cases again.
Victims of scams of the cybercrime organization of Gal Barak, for example, have filed lawsuits against ING‘s subsidiary Payvision with the support of Elfriede Sixt‘s European Fund Recovery Organization (EFRI). ING has long since discontinued Payvision‘s business. Like Bruc Bond, Payvision supported scammers and laundered their stolen funds. Payvision, especially in connection with Gal Barak and the German cybercrime mastermind Uwe Lenhoff.
Eyal Nachum and Tamir Zoltovsky‘s payment group acted as a payment facilitator for the huge scams surrounding the Cartu Brothers‘ GreyMountain Management (GMM) and many other Israeli binary options schemes.
In recent years, some victims have filed lawsuits against the Cartu Brothers – currently, investors are suing them in Ireland. In some cases, out-of-court settlements have been reached. But the vast majority of victims have lost their money. Over the next few weeks, we will review these cold cases in the almost forgotten binary options industry.
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