New Jersey
A Florida man has been sentenced to 45 months in prison for laundering funds from a $50 million internet fraud scheme, federal officials announced today.
Federal officials say Denis Sotnikov, 39, of Hallandale Beach, Fla., previously pleaded guilty to one count of conspiracy to launder money.
According to documents filed in this case and statements made in court:
From 2012 to October 2020, Allen Giltman, 56, of Irvine, California, and others engaged in an internet financial fraud scheme, which typically involved creating fraudulent websites to solicit funds from investors.
Officials claim that sometimes fraudulent websites have been designed to look like those operated by real, well-known and reputable financial institutions; at other times, fraudulent websites were designed to look like seemingly legitimate financial institutions that didn’t exist.
Victims of the scam scheme usually discovered scam websites through internet searches.
According to officials, the fraudulent websites advertised various investment opportunities, mainly the purchase of certificates of deposit or CDs.
Fraudulent websites advertised above-average rates of return on CDs to lure potential victims.
According to federal officials, Sotnikov received funds from at least 18 victims of the fraudulent scheme, totaling about $6 million, into accounts at various domestic banks controlled by him or a close relative.
Of this amount, about 3.7 million dollars were frozen by the banks or returned to the victims, and 707,380 dollars were transferred by Sotnikov abroad.
The remaining stolen funds – approximately $1.5 million – were transferred to numerous other accounts controlled by Sotnikov, which were used to finance personal expenses.
To date, law enforcement has identified at least 150 fraudulent websites created under this scheme.
Officials say at least 70 victims of the fraudulent scheme nationwide, including in New Jersey, collectively forwarded funds they believed to be investments totaling at least about $50 million .
Giltman has pleaded guilty to his role in the fraudulent Jan. 5 scheme and is awaiting sentencing.
According to federal officials, in addition to the prison sentence, he was sentenced Sotnikov to three years of probation.
The U.S. Securities and Exchange Commission (SEC) previously filed a civil lawsuit against Sotnikov and several companies associated with him for the same behavior.