During this decade Israel established itself as the main hub of these types of scams. Many of the Israeli firms and individuals have since relocated overseas and continued their fraudulent schemes. —
Now, other countries are following suit. The US, UK, Germany and other countries have increased their enforcement efforts against criminals who defraud investors, no matter where they are located in the world. Numerous news articles have reported on the arrests of Israeli citizens involved in foreign forex and binary trade scams.
It is still unclear whether the same level of efforts and resources against Israelis suspected of involvement with forex marketing fraud crimes would be at such an enormous scale, had Israel's law enforcement authorities prosecuted Israeli suspects for these crimes in Israel. But there seems to be hope.
Worldwide cases against Israeli forex scammers
After laying their initial roots in Israel, the forex scammers quickly spread like a plague outside of the country, following a combination of opportunism and the eventual crackdown of the authorities in Israel on the industry. This has led to multiple high-profile cases of forex and financial fraud instigated by Israeli scammers. Some of the more known cases are:
According to prosecutors in Koblenz, Germany, in May 2016, Avi Itzcovich and Jacques Henri Wygodski launched a website called TraderVC that ran on the fake trading platform of an Israeli company known as Panda TS.
The scammers' tactics were simple. When one fraudulent website attracted too much negative attention from the public or regulators, Itzcovich and Wygodski would just switch to a new brand and launch a new fraudulent site. So when TraderVC fell under scrutiny, Kayafx was already up and running, and when the same happened to Kayafx, they moved to Kontofx and then Libramarkets, which operated from March 2019 onward.
While the websites took the heat, the platforms stayed up and running, meaning that these fraudsters could keep their basic business model and just change their name and domains. Avi Itzcovich was arrested since, while Henri Wygodski is still on the run.
The story of the “Wolf of Tel Aviv” is the biggest forex scam that came out of Sofia, Bulgaria. It is another major scam that was led by Israeli Gal Barak and E&G Bulgaria, made possible by using the brand Get Financial.
In September 2020, an Austrian court sentenced Gal Barak to four years in prison and a payment of approx. €4.2 million for investment fraud and money laundering. He was the boss of the cybercrime organization E&G Bulgaria. Of that, €2.5 million has already been seized by authorities from the bank accounts of Gal Barak and his companies. Barak was also ordered to pay another €1.7 million within 14 days to the 212 victims represented by EFRI in the trial.
The “Yukom-Scheme” is one of the biggest known scams in the US forex market in the past two decades. It was orchestrated by Yukom Communications Ltd, an Israel-based sales and marketing company owned by Joseph (Yossi) Herzog and Yakov (Kobi) Cohen.
The Yukom Scheme defrauded tens of thousands of victims worldwide for over $150 million. Since the uncovering of the scam, Yukom Communications CEO Lee Elbaz was convicted and sentenced to 22 years in jail but the company itself vanished along with Herzog and Cohen. Their attorney, Moshe Strugano, a Tel-Aviv based lawyer with well-documented ties to the forex industry, remains active as a facilitator of offshore companies, bank accounts, and permits.
Strugano and other similar service providers play a key role in enabling the fraudulent forex industry to keep on churning fraudulent schemes perpetually. Dubbed "Concierge to the Forex Scammers", professionals like Strugano enable fraudsters to setup their fraudulent business by providing full infrastructure services, bank accounts, money transfer routes, legal opinions and more.
The Yukom-Scheme was one of three operators of illegal boiler rooms in the Yukom Scheme. The other two operations were Numaris Communication Ltd in Israel and Linkopia Ltd in Mauritius.
Name: Ephraim Agmon
Email: Send Email
Release ID: 89057602