Estonian HashFlare Founders Ordered to Leave the U.S

Sergei Potapenko and Ivan Turogin, the Estonian co-founders of the now-defunct crypto mining company HashFlare, are involved in a legal battle with U.S. federal authorities. Their lawyers claimed that the U.S. Department of Homeland Security (DHS) had ordered them to leave the country immediately or face serious legal trouble. 

Court Ruling Says Something Different

Potapenko and Turogin received formal letters from the DHS. The letters warned they would face serious consequences if both individuals did not leave the United States. These may include criminal charges, fines, and aggressive action from federal authorities. However, a court has previously ordered both men to stay in King County, Washington, due to ongoing legal matters related to the collapse of their cryptocurrency business.

HashFlare was once a popular cloud-based cryptocurrency mining service, but it closed down due to fraud accusations and poor management. Potapenko and Turogin were charged with running a complicated scheme that allegedly cheated investors out of hundreds of millions of dollars. Likewise, the U.S. authorities have tried to extradite and prosecute them for several years.

It is currently unclear how the situation will be resolved. Meanwhile, the defendants agreed to give up about $400 million in assets as part of the plea deal. This includes real estate, cryptocurrency, vehicles, and mining equipment. Sentencing is set for August 14. The attorneys have asked for clarity and legal protection, stressing that the co-founders are committed to fully complying.

SEC Charges Touzi Capital Over Crypto Mining Fund Fraud

The US SEC accused investment firm Touzi Capital of defrauding over 1,200 investors last year. The regulator claims the company raised nearly $95 million under pretenses, marking another high-profile case of alleged misconduct in the cryptocurrency sector.

As reported by TheCoinRise, the SEC alleged that Touzi Capital misled investors by portraying its crypto asset mining fund as a stable, high-yield opportunity comparable to money market accounts. Instead, funds were reportedly misused across unrelated ventures, exposing investors to substantial risks.

Rise in Ponzi Schemes

Ponzi schemes have been increasingly prevalent in the crypto space. In 2022, blockchain intelligence firm TRM Labs reported that an alarming $7.8 billion was lost to the crypto pyramid and Ponzi schemes.

In May 2024, a Manhattan resident was charged with wire fraud for running a Ponzi scheme. The scheme caused investors to lose at least $43 million.