OneCoin scammers Mark Scott and Karl Sebastian Greenwood have had their judgment appeals denied.

Both Mark’s and Greenwood’s United States Court of Appeals mandates were filed on May 14th.

Greenwood (right), currently incarcerated, was sentenced to twenty years in prison in September 2023.

Greenwood’s appeal was built around two primary arguments;

(1) the district court erred by calculating his sentence based on both domestic and foreign losses of the OneCoin scheme, and

(2) his sentence was substantively unreasonable.

The Appeals Court rejected Greenwood’s “domestic and foreign losses” argument on the basis

the OneCoin conduct that occurred over foreign wires was relevant conduct because it was part of the same common scheme or plan as the domestic conduct.

Greenwood and his co-conspirators engaged in a multi-level marketing scheme to defraud investors worldwide into purchasing a fraudulent cryptocurrency.

The losses effectuated over foreign wires resulted from the same “common scheme or plan” as the losses effectuated over American wires.

On Greenwood’s sentence being unreasonable;

We conclude that the district court did not abuse its discretion by imposing a sentence of 240 months of imprisonment.

The district court considered both the aggravating factors of Greenwood’s conduct—the scale of the scheme, its targeting of vulnerable and poor victims, and Greenwood’s extensive profit—and the mitigating factors that Greenwood identifies on appeal.

The district court accounted for the severe conditions that Greenwood experienced following his arrest in 2018.

Under these circumstances, the sentence does not “constitute a ‘manifest injustice’ or ‘shock the conscience’” because it is not “shockingly high, shockingly low, or otherwise unsupportable as a matter of law.” United States v. Rigas, 583 F.3d 108, 123, 124 (2d Cir. 2009).

Mark Scott (right), was sentenced to ten years in prison in January 2024.

Scott raised four primary arguments in his judgment appeal;

First, he argues that the district court abused its discretion by denying his motion for a new trial based on the purported perjury of Konstantin Ignatov.

Second, he argues that the district court abused its discretion by excluding evidence as hearsay and quashing a subpoena of Neil Bush.

Third, he argues that there was insufficient evidence to support his conviction for conspiracy to commit money laundering.

Fourth, he argues that there was insufficient evidence to support his conviction for conspiracy to commit bank fraud.

On Konstantin Ignatov perjuring himself, the Appeals Court found

there was no “reasonable likelihood” that the testimony affected the judgment of the jury.

On the exclusion of evidence (emails) and Neil Bush’s subpoena being quashed;

The emails that Scott sought to introduce qualified as hearsay.

Scott told the district court that the emails proved that a partner at his law firm advised Ruja Ignatova without knowing that OneCoin was a fraud. Contrary to Scott’s argument, these emails were not evidence of Scott’s “then-existing state of mind”

Nor did the district court abuse its discretion by quashing the subpoena of Neil Bush.

As the district court noted, evidence of Bush’s involvement in the CryptoReal transaction was already presented to the jury. Bush’s testimony could not have provided any evidence of Scott’s understanding of the legitimacy of the CryptoReal transaction because Bush and Scott never met.

On Scott’s claim of insufficient evidence pertaining to his money laundering conviction;

The government sufficiently proved the centrality of domestic use of wires to the money-laundering schemes.

The jury saw evidence that OneCoin targeted investors in the United States—including emails between Ruja Ignatova and Scott regarding how to structure OneCoin’s American business—and heard the testimony of two American victims concerning the wire transfers they made from their American bank accounts, the promoters in the United States who introduced them to OneCoin, and their losses from their investments in OneCoin.

That only a portion of the overall losses were suffered by American victims does not render the scheme extraterritorial.

The district court properly instructed the jury on the jurisdictional element of a wire fraud offense.

Scott’s supplemental instruction was legally incorrect because the government was not required to trace the funds being laundered to the “proceeds” of a domestic wire fraud. Cf. Zvi, 168 F.3d at 56 (rejecting a “narrow definition of ‘proceeds’” of the specified unlawful activity under 18 U.S.C. § 1956(a)(1)(B)(i), (a)(2)(B)(i)).

Nor would it have been correct for the district court to instruct the jury that the fraud must have “occurred” in the United States.

Regardless, the government offered evidence that an American victim wired money to a OneCoin depository account based in the United States, which then transferred her money to the Fenero Funds.

And finally, on Scott’s claim of insufficient evidence to convict him of bank fraud;

There was sufficient evidence to support Scott’s conviction for conspiracy to commit bank fraud.

The evidence of the CryptoReal transaction, for example, allowed the jury to find that Scott conspired to commit bank fraud.

Although the evidence concerning the CryptoReal transaction was alone sufficient for a rational jury to find Scott guilty of conspiracy to commit bank fraud, the government also presented evidence in connection with the Armenta transactions.

Scott argues that Armenta’s statements to his banks do not show that Scott conspired with Armenta to commit bank fraud, but the government also presented evidence that

(1) Scott knew the Fenero Funds were not legitimate investment funds,

(2) banks were refusing to process funds associated with OneCoin, and

(3) the origin of the funds in Armenta’s account was OneCoin. A rational jury could conclude that Scott knew that Armenta would be able to transfer the OneCoin funds only if Armenta lied to his banks.

And in summation, regarding both of Greenwood’s and Scott’s appeal arguments;

We have considered Greenwood’s and Scott’s remaining arguments, which we conclude are without merit. For the foregoing reasons, we affirm the judgments of the district court.

As previously noted, Greenwood is already incarcerated and will remain so until the end of his sentence.

Scott was released pending the outcome of his appeal in April 2024. Pursuant to Scott’s appeal being denied, on May 14th (the same day the appeal decisions were docketed), the DOJ requested the court set a surrender date.

The defendant was convicted at trial more than five years ago, the Second Circuit has affirmed his conviction by summary order, and the Second Circuit has issued the mandate back to this Court.

The Government respectfully requests that the Court set a prompt surrender date for the defendant.

Later the same day still, Scott’s lawyer trotted out “ongoing medical issues” in a bid to avoid Scott returning to prison.

There have been several significant new developments in certain of Scott’s conditions for which he has treatment scheduled in the coming weeks.

In light of Scott’s ongoing medical issues, Scott requests an opportunity to provide this Court with a more detailed update regarding the status of his conditions and treatment before this Court sets a surrender date. Scott will make any such submission by May 19, 2025.

Scott’s claimed medical conditions materialized in 2020 following his arrest. Perhaps notably, Scott’s lawyer didn’t address why Scott can’t receive treatment in prison.

Nevertheless the court has granted Scott till May 19th to come up with more excuses. Stay tuned for an update after May 19th.

 

Update 23rd May 2025 – Mark Scott has been ordered to surrender to the BOP to begin his prison sentence on August 18th, 2025.