Overview of the Case Scam-or Project has been contacted by several individuals claiming to be victims of the unregulated investment platform Blue Trading. The platform operated without proper authorization, and the UK’s Financial Conduct Authority (FCA) had already issued a public warning about the firm in September 2018. Operations officially ceased on February 24, 2019, allegedly due to issues with its proprietary trading software. Onyx Capital, a company believed to be affiliated with Blue Trading, has also come under scrutiny. Platform Closure and External Reports While direct testimonials from victims provide key insights, summaries of Blue Trading’s collapse have also…
Author: Tom
Uncovering the Financial Infrastructure Behind Illegal Broker Schemes Overview In recent months, investigative authorities and independent research organizations such as the Organized Crime and Corruption Reporting Project (OCCRP) have intensified efforts to uncover the vast network of illegal brokerage operations responsible for defrauding tens of thousands of investors globally. According to FBI estimates, binary options scams alone may have cost investors up to $10 billion annually. Among the leading figures orchestrating these schemes are Gal Barak, currently under arrest, along with Gery Shalon and Vladislav Smirnov. Another key player, Uwe Lenhoff—now imprisoned—ran fraudulent broker operations under the publicly traded Veltyco…
Background on Illicit Brokerage Structures The investigation of fraudulent online brokers frequently leads the Scam-or Project through a web of international jurisdictions. Despite many of these operations being directed by Israeli figures like Gal Barak and Gery Shalon, the execution of such schemes often relies on operations based in other countries. Key components in these operations include boiler rooms and payment service providers (PSPs)—with favored hubs in Bulgaria, Serbia, Bosnia-Herzegovina, and Montenegro. Balkan Networks of Boiler Rooms and Payment Systems Entities tied to Gal Barak, such as E&G Bulgaria, and networks like Uwe Lenhoff’s Veltyco, have long operated across the…
The Scale of the Fraud Since early 2018, the Scam-or Project has been actively reporting on illegal brokerage operations, particularly those involving binary options. According to the FBI, investors were defrauded of approximately $10 billion annually through binary options alone. While this product has since been outlawed in most regions, the period from 2010 to 2018 saw a massive surge in activity, leaving countless victims and financial losses reaching into the tens of billions. Legal proceedings are still unfolding across Europe. Legal analysts suggest that payment service providers (PSPs) supporting these schemes may be considered accomplices and held accountable under…
Undisclosed Share Purchases by Uwe Lenhoff Through Bulgarian Entities According to information obtained by the Scam-or Project from sources closely associated with Veltyco Group and its stakeholders, Uwe Lenhoff—founder and former director of the company—allegedly acquired Veltyco shares in 2017 without properly disclosing these transactions, despite his directorial position. This concealment raises significant concerns, especially considering that the notable price surge in 2017 may have been driven by these insider dealings. It is alleged that Lenhoff executed these transactions through his Bulgarian companies, Windsor Enterprises Ltd and Savora Consulting Ltd, both reportedly involved in fraudulent brokerage operations tied to platforms…
Arrest of “The Wolf of Sofia” Gal Barak, an Israeli national, is known as the head of E&G Bulgaria, a company linked to multiple unauthorized online trading platforms including SafeMarkets, XTraderFX, Golden Markets, and OptionStarsGlobal. These platforms are accused of defrauding thousands of retail investors across Europe and beyond. In February 2019, Barak—often referred to as the “Wolf of Sofia”—was apprehended in Bulgaria during an international law enforcement operation. Due to reported health concerns, he was subsequently placed under house arrest in Sofia. At a recent court session in the Bulgarian capital, the judge chose to postpone the decision on…
Introduction To the team at Wealth Recovery International, To Ms. Tami Hamm, This letter aims to address recent events and public discussions concerning Wealth Recovery International and its co-founder, Austin Smith, in relation to binary options activities and subsequent legal proceedings. Legal Status of Austin Smith Austin Smith, co-founder of Wealth Recovery International, has entered a guilty plea in a U.S. federal case involving conspiracy to commit wire fraud linked to binary options. As part of the plea deal filed on March 14, 2019, Smith admitted to misconduct related to his previous employment at BinaryBook. According to court filings, Smith…
Reported Threats Linked to Gal Barak and Uwe Lenhoff Recent intelligence suggests that Gal Barak may have approached Fazli Hasi with a troubling request. Based on multiple sources and supporting evidence, it appears Hasi was allegedly asked to intimidate or harm individuals associated with ongoing investigations into Barak’s operations. After carefully evaluating the material received, it seems likely that the threat is real. Previous connections between Uwe Lenhoff and Fazli Hasi have also been mentioned in this context, suggesting this is not an isolated incident. Why This Is Being Made Public In situations like this, transparency can be the most…
Unraveling Cross-Border Financial Operations from Montenegro to Bulgaria A Widening Web of Financial Crimes The sprawling financial operations of Uwe Lenhoff and Gal Barak, two central figures in a multi-jurisdictional cybercrime network, appear even larger than previously revealed. The Central Bank of Montenegro (CBCG) initiated bankruptcy proceedings against Atlas Bank in April 2019, following administrative control imposed in December 2018. This bank, controlled by Montenegrin tycoon Dusko Knezevic, played a significant role in enabling illicit financial flows linked to the Lenhoff-Barak operation. Key Allegations: Atlas Bank is suspected of laundering more than €500 million. Knezevic, now in exile, has filed…
Interview with EU Victim Representative In a recent interview with Bulgarian journalist Desislava Rizova from bTV, Elfriede Sixt, a coordinator and financial crime analyst frequently consulted on EU fraud cases, shared insights into the ongoing investigation of Gal Barak, often referred to as the “Wolf of Sofia.” (article) She represents over 260 victims affected by schemes allegedly tied to Barak and his network, including platforms like XTraderFX, SafeMarkets, OptionStarsGlobal, and CryptoPoint. Arrest and Legal Proceedings In early February 2019, Gal Barak and his German associate Uwe Lenhoff were arrested as part of a large-scale investigation spanning Austria, Germany, and Bulgaria.…