CoinVoice has recently learned that, according to Decrypt, U.S. federal prosecutors have filed a petition with the Ninth Circuit Court of Appeals seeking to overturn the lenient sentence of the main perpetrator in the HashFlare cryptocurrency fraud case. Estonian citizens Sergei Potapenko and Ivan Turõgin are accused of defrauding 440,000 investors worldwide through a $577 million Ponzi scheme, and prosecutors believe the original sentence was "exceptionally lenient."
The two defendants have pleaded guilty, admitting to committing fraud through false mining contracts from 2015 to 2019, misleading investors with fake profit dashboards, and using the proceeds of the fraud to purchase luxury goods and pay returns to early investors. The original trial judge only sentenced them to three years of supervised release and a $25,000 fine each, whereas prosecutors had requested a 10-year prison sentence.
The judge considered factors such as the risk of "indefinite detention" that foreign defendants may face in the U.S. Legal experts have analyzed that the reasoning behind the sentence, based on "time served, immigration risks, and compensation considerations," is reasonable, and the Ninth Circuit Court generally respects the discretion of district judges, making it likely to uphold the original ruling.
Currently, $400 million has been seized for victim compensation, and the case is referred to as the "largest fraud case in the history of the Western District of Washington." [Original link]