Israeli extradited to Germany over alleged part in massive investment scam
An Israeli man was extradited to Germany recently to stand trial for his suspected part in several fraudulent investment schemes victimizing German citizens, the Ynet news site reported on Thursday.
Yuri Dashevsky, 33, was among 15 people arrested in 2021 during a raid on a Petah Tikvah call center requested by German police.
Israeli police eventually held Dashevsky and three others on suspicion of defrauding German citizens by means of binary options, forex and cryptocurrency scams.
The men are accused of being part of an organized gang that allegedly ran a gamut of websites hawking risky or fraudulent investment schemes from 2015 to 2019. The websites were named as IntegraOption, SolidCFD, TradeSolid, BitCapitalMarkets, GetFinancial, ProCapitalMarkets, NordCapitalMarkets, ProfitsTrade, FXPace, AccepTrade and GainFinTech.
According to the public prosecutor’s office in Bamberg, Germany, these websites are all connected and were run by the four suspects and their associates over the internet and from call centers in Israel and in Tbilisi, Georgia; Yerevan, Armenia; and Chisinau, Moldova.
In addition, in 2019 the group allegedly ran the alleged recovery room scams FXLaws and Tradelegal, in which they offered to help victims of scams recover their money — for a fee. These websites allegedly took victims’ money without helping them, German prosecutors charged.
The suspects allegedly persuaded people around the world to invest money in forex, binary options, and other financial instruments. Regulators say the investment schemes, which often involve betting on stock market movements but not actually owning the underlying securities, are akin to illegal gambling and rife with fraud. The suspects were accused of using the money people thought they were investing in the market to instead run their call centers and platforms as well as for their own personal use.
German victims alone lost several million euros to these sites, German prosecutors said. The sites targeted people all over the world, which suggests the losses to alleged victims worldwide were much higher. The 11 websites German prosecutors said were controlled by the suspects were powered by two platforms: SpotOption and Tradologic.
In October, Israeli police reportedly detained and questioned a lawyer who was thought to have taken part in the management of the websites run by the suspects in the Petah Tikva call center, according to Israel’s Posta crime news website. The questioning was reportedly carried out at the behest of German police.
Seven individuals who were part of the same group as those in Petah Tikva were arrested in Georgia, according to an October 27 press release issued by the public prosecutor in Bamberg, Germany. Three of the people arrested in Georgia were women.
Since 2005 Israel has been a hub of internet fraud involving fake online trading or investment websites. Israeli authorities have largely ignored the fraud, allowing it to blossom into a full-fledged industry that has employed thousands of people and stolen billions of dollars from internet users worldwide.
Initially, these fraudulent websites offered forex trading. By 2013, many of the forex operatives began offering trading in a financial instrument known as binary options. After binary options websites were outlawed by the Knesset in 2017 — as a direct result of reporting by The Times of Israel — many of the same operatives created websites that offered fake forex, CFD and cryptocurrency trading. Some moved part of their operations abroad.
While Israeli police have over the years arrested a handful of these operatives, almost none have been prosecuted. Similarly, while Israeli media outlets have reported on individual investment scams, they have often depicted these as lone-wolf operations, failing to explain that they are part of a massive, interconnected industry.
In recent years, law enforcement in the United States, Germany, Austria, and to a lesser extent Canada have, unlike their Israeli counterparts, investigated, indicted and convicted some of these Israeli alleged investment scammers.