HashFlare Co-Founders Plead Guilty to Wire Fraud in $577M Scheme
Co-founders of Hashflare, Sergei Potapenko and Ivan Turõgin, pleaded guilty to conspiracy to commit wire fraud. The scheme defrauded investors of $577 million between 2015 and 2019.
- Both men were arrested in Estonia in November 2022 and extradited to the U.S.
- They face a maximum sentence of 20 years in prison.
- Hashflare misrepresented its crypto mining operations, owning less than 1% of claimed computing power.
- Investors received payments funded by purchased cryptocurrency instead of profits from mining.
- Defense claims no financial harm occurred to investors; they argue the operation provided some mining services.
- The defendants will forfeit over $400 million in assets to compensate investors.
- Sentencing is scheduled for May 8 in Seattle.