A US federal judge has sentenced former CEO of Israel-based Yukom Communications, Lee Elbaz, who was found guilty for her participation in a $145 million fraud scheme carried out by Israeli-run binary options websites.
In a judgment filed on Thursday, Elbaz was sentenced to a prison term of 22 years. She was convicted in the District of Maryland of one count of conspiracy to commit wire fraud and three counts of wire fraud. Each of the four counts carries a maximum penalty of 20 years in prison.
Elbaz was arrested in 2017 after traveling to New York and was indicted in March 2018 alongside 15 defendants in the case. In August, she was convicted by a federal jury in connection with a vast binary options scheme to defraud investors all over the world.
Elbaz was the first to be tried, but Lissa Mel, an Israeli former reality show contestant, was the first of 21 defendants to be sentenced. Five have pleaded guilty and agreed to cooperate with prosecutors while nine other defendants, including Yukom owner Yosef Herzog, were found guilty in February.
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Last month, two former owners of the binary options websites BigOption and BinaryBook, together with 13 other employees, were charged in a Maryland court with one count of conspiracy to commit wire fraud and three counts of wire fraud.
The defendants in the complaint are two business partners who allegedly had ownership interests in Yukom Communications and other related entities, Yakov Cohen, 27 and Yosef Herzog, 54. In addition, the complaint also names Ori Maymon, 33; Nissim Alfasi, 33; Elad Bigelman, 37; Runal Jeebun, 29; Sabrina Elofer, 28; Afik Tori, 27; Anog Maarek, 28; Oron Montgomery, 38; David Barzilay, 41; Gilad Mazugi, 36; Hadas Ben Haim, 34; Yousef Bishara, 32; and Nir Erez, 29.
The FBI found in its investigations that Yukom brands have betrayed investors to the tune of $145 million between 2016 and 2017, while only $20 million of this amount was paid back to defrauded victims during this period.
Elbaz trained employees to lie to investors
According to the court papers, Yukom representatives, working under Elbaz’s supervision, operated two binary options brands which were used to misled investors by falsely claiming to represent the interests of investors while, in fact, their company profited when investors lost money.
Elbaz, who proudly called herself a “money-making machine,” trained employees to lie to investors and rigged the odds against them, while falsely guaranteeing returns of up to 40 percent. Elbaz and her co-conspirators also misrepresented the expected return on binaries trades, using the terms of “bonuses,” “risk free trades,” and “insured trades” to assure them that their investments are safe. They also provided investors with false names and qualifications, and falsely claimed to be working from London.