Police in the southern Russian city of Astrakhan have arrested a man on charges of defrauding people who wanted to buy crypto miners. Police officers say the suspect made millions of rubles from fake sales of mining equipment to Russian citizens and foreigners. A resident of Kazan, the capital of the Russian republic of Tatarstan, was arrested in Astrakhan in southern Russia for defrauding 10 local residents and several foreigners who wanted to buy mining equipment from him.
The Russian placed fake ads for the sale of cryptocurrency mining machines and insisted on receiving an advance payment. According to police officials, he managed to collect about 19 million rubles (about $315,000) in this way. “According to the investigation, a young man published on the Internet attractive offers for the sale of equipment for mining digital currency, which he did not actually have. He is now charged with a criminal case under Article 159, paragraph 3 of the Islamic Criminal Code. . From the Russian Federation (fraud especially large sizes)”, reported in the Astrakhan Region. The local Department of the Ministry of Internal Affairs explained. The press release states that the suspect promises victims that he will send cryptocurrency miners if they pay him in full. One of the buyers deposited 936,000 rubles into the bank account of the seller, who cut off all communication as soon as he received the money. A dealer in counterfeit mining equipment could face up to six years in prison if convicted in court.
Cryptomining fraud and theft is on the rise in Russia as cryptocurrency mining becomes an increasingly popular, lucrative business for companies and an alternative source of income for many ordinary Russians. In June, 1.9 million dollars worth of mining equipment was stolen from a mining hotel in Irkutsk. In July, masked people hacked a large crypto farm near Moscow. Tatarstan, where the arrested fraudster is from, has become home to Russia’s largest Ponzi scheme in recent years. The Finice pyramid lured investors from Russia, the former Soviet Union, Europe and other countries with promises of exorbitant profits in exchange for bitcoins they sent to the phantom company.