In September 2021, the Israeli cybercrime kingpin Gal Barak was sentenced to four years in prison for investment fraud and money laundering in Austria. German prosecutors, led by Nino Goldberg, also want to charge Gal Barak, see him convicted and sentenced to prison. Barak appealed against the indictment; the case is currently before the European Court of Justice. Barak’s former boiler room manager Tal-Jacki Fitelzon has already been indicted (report here). Barak’s former partner in crime, Uwe Lenhoff, died in prison last year, but his co-conspirators will be indicted. Barak and Lenhoff allegedly produced more than 200,000 victims in Germany!
A Cybercrime Dimension
The Barak and Lenhoff scams are keeping prosecutors across Europe busy. In Germany, the public prosecutor’s offices in Saarbruecken and Bamberg are responsible. Barak and Lenhoff are just two of the principals of this global cybercrime organization. The real mastermind was Israeli Gery “Gabi” Shalon, who has been charged with cybercrime in the U.S., and Russian Vladislav “Vlad” Smirnov. Both are listed as suspects in Europe. The dimensions of this cybercrime organization are not yet clear.
The investor fraud with the platforms of Gal Barak and Uwe Lenhoff has an incredible and not yet seen dimension. According to Bamberg’s public prosecutor’s office, more than 200,000 people were defrauded by Barak and Lenhoff’s scams in Germany alone. The criminal file comprises more than 500 volumes. The indictment of Barak and Lenhoff’s accomplices will take several more months. Due to the unbelievable volume, the victims’ lawyers will not have access to the criminal files until the fall.
The Dutch Connection
Uwe Lenhoff had financially strong partners in Amsterdam, the Netherlands, such as the real estate investor Dirk-Jan Bakker or the then Payvision CEO Rudolph Booker.
Payvision and Booker knowingly and wilfully facilitated the scams for Lenhoff and Barak, processing tens if not hundreds of millions stolen from consumers to the pair’s offshore companies until shortly before their arrests in early 2019. Without the involvement of Payvision and Rudolph Booker, this gigantic scam would not have been possible at all.
On the other hand, Uwe Lenhoff and Dirk-Jan Bakker were the founders of the listed Bet90 Holdings PLC (formerly Veltyco Group PLC). Its shares are listed on the AIM segment of the London Stock Exchange. This company was the “official” front of Lenhoff’s cybercrime organization and “officially” funded the marketing campaigns to acquire victims for their scams such as Option888, LottoPalace, XMarkets, ZoomTrader, TradoVest, or TradeVest90.
The Indictment
Barak’s co-conspirator Tal Jacki Fitelzon is charged by German prosecutors led by Chief Prosecutor Nino Goldbeck to have been a co-conspirator in the cybercrime organization E&G Bulgaria. This organization operated broker scams XtraderFX, SafeMarkets, or OptionStarsGlobal, among others. Fitelzon was “Vice President Sales” and responsible for the day-to-day operations of Barak’s boiler rooms. Please read this report here. The prosecution wants to send Fitelzon to jail for this. We will be watching and reporting on the trial.
In the German indictment, the prosecutor refers to 365 victims of the E&G Bulgaria scams. This is only a small fraction of the actual victims. A former partner of Gal Barak speaks of more than 50,000 victims worldwide and more than €200M stolen funds.
Given the 200,000 victims, more indictments will follow around E&G Bulgaria, and Lenhoff’s organization will follow in Germany. If the European Court of Justice allows the charges against Gal Barak, he will probably also be sentenced in Germany to several years in prison. It is not yet clear when the European Court of Justice will rule. It may still take many months. It will definitely be a precedent and a landmark decision in the fight against cybercrime in the EU.
