Bitrabo Editorial
Lilian Nurieva, who held the position of Head of Networks at the Russian crypto Investment fund Finiko, has been sentenced to three years in prison. She was charged with defrauding private investors and being part of an organized criminal group.
The scheme, involving $55 million, is deemed the second-largest financial fraud in Russia’s post-Soviet era by the Federal Foundation for the Protection of Investors and Shareholders Rights.
Crypto Investment Fund Unveiled as Ponzi Scheme
In 2021, authorities in Russia launched an investigation into the crypto investment fund Finiko for fraudulent activities and organized crime. The investigation revealed that the fund operated as a Ponzi scheme, extracting millions from investors.
Between 2018 and 2021, Finiko masqueraded as a crypto fund, luring in investors as part of a pyramidal scheme. Kirill Doronin, the mastermind behind the scam, conducted seminars nationwide, attracting a vast clientele.
Together with his partners, Doronin established a criminal network to systematically misappropriate individuals’ funds. Promising a “unique automatic profit generation system,” they guaranteed significant returns in cryptocurrencies like Bitcoin.
Initially, investors received dividends and could withdraw funds in BTC. However, as Finiko’s crypto token lost value in 2021, the company abruptly closed its offices and shut down its website, leaving investors at a loss.
Doronin claimed technical glitches within the fund, only to be revealed that his associates had absconded abroad with investors’ money.
An investigation unveiled that many investors resorted to loans or selling their homes to invest in the fraudulent scheme. The fund operated as a Ponzi scheme, where existing clients received payments from new investors’ capital. The Ministry of Internal Affairs of the Russian Federation estimated that over 10,000 individuals were swindled, with losses amounting to 5 billion rubles, approximately $55 million.
First Exec of Finiko Receives Conviction
Lilia Nurieva, a former executive at Finiko, was found guilty of defrauding investors by the Vakhitovsky District Court of Kazan. Nurieva, a crucial player in the crypto scheme, received a reduced sentence for aiding the prosecutors.
Initially sentenced to four and a half years for fraud and involvement in a criminal syndicate, Nurieva will now serve a three-year prison term, inclusive of pre-trial detention.
While the prosecution sought a six-and-a-half-year sentence, Nurieva struck a pre-trial deal, enabling her to evade a maximum ten-year imprisonment term.
Admitting to the charges, Nurieva collaborated with the inquiry, leading to a separate trial from other defendants. Her attorney, Maria Belousova, acknowledged the fairness of the accusations, stating that Nurieva was the lone defendant who invested personal funds in the scheme.
Belousova revealed that the former Finiko executive had invested 40 million rubles before joining the organization:
Upon association, there were misconceptions about legality and criminality, which were later clarified in conversations with top management.
The remaining ten defendants, including Doronin, are awaiting trial. The Prosecutor General’s office endorsed their indictment on April 27, forwarding it to the Vakhitovsky court. The defendants face charges of forming a criminal group and large-scale fraud.