Leaked Dubai property files link luxury flats to OneCoin crypto scammers - ICIJ (2024)

In the spring of 2015, accused Bulgarian cryptocurrency fraudster Ruja Ignatova was amassing a fortune by selling fake digital currency.

The entrepreneur had recently founded OneCoin, a Sofia-based firm that purported to issue a cryptocurrency that she declared would be “the number one” worldwide. International investigators would later link it to a $4 billion pyramid scheme with more than 3.5 million victims around the world.

As she was getting ready to launch her business in the U.S. and potentially entice more unsuspecting investors, Ignatova and some of her associates settled in Dubai, the United Arab Emirates’ financial hub.

There she incorporated shell companies and opened bank accounts to receive and allegedly launder money wired from OneCoin investors. She set up and managed a hair- and body-care salon called Kings & Queens with two of her OneCoin associates, documents obtained by the International Consortium of Investigative Journalists show. She listed as company offices two units in a building near Dubai Marina. And she used a Dubai shell company to buy a $2.7 million penthouse apartment on the top floor of a skyscraper overlooking Palm Jumeirah, an archipelago of artificial islands in the Persian Gulf, according to the documents reviewed by ICIJ.

Now newly leaked confidential Dubai land records shine a light on the role Dubai plays for criminals and suspects such as Ignatova and her cronies, many of whom are serving lengthy prison sentences or are on the run from international law enforcement. Ignatova, who called herself the “Cryptoqueen,” went missing in 2018 shortly after U.S. authorities issued a warrant for her arrest.

The Dubai records were obtained by the Center for Advanced Defense Studies (C4ADS), a Washington, D.C.-based nonprofit organization that analyzes data on transnational security matters. C4ADS shared the data with ICIJ and more than 70 media outlets as part of the Dubai Unlocked investigation coordinated by the Organized Crime and Corruption Reporting Project (OCCRP) and Norwegian financial outlet E24.

The most recent dataset is dated 2022 and has information on Dubai property owners, from wealthy businesspeople and family members of prominent politicians to most-wanted criminals.

Many members of the international reporting team (but not ICIJ) previously analyzed Dubai’s 2020 land data and found that property owners included more than 100 members of Russia’s political elite, public officials or businesspeople close to the Kremlin, as well as dozens of Europeans implicated in money laundering and corruption cases.

According to the Dubai records and other corporate filings reviewed by ICIJ, in March 2015, Ignatova set up a Dubai company called Oceana Properties Ltd. and used it to buy the luxurious 5,303-square-foot flat in the Oceana Pacific building where she officially resided.

In 2017, as the U.S. Justice Department sought to indict her on fraud and money laundering charges, Ignatova closed down OneCoin’s Dubai companies and her beauty salon. Then, within days of her indictment and issuance of an arrest warrant on Oct. 12 that year, she boarded a plane to Athens and disappeared.

According to ICIJ’s media partner Bird, files seized by Sofia police during a search of a slain police officer’s home appear to show that Ignatova was later killed on a yacht in Greece on the order of a Bulgarian mafia boss. But some news outlets have questioned that account.

In 2019, after several banks flagged transactions involving the “Cryptoqueen” and her companies as suspicious, Ignatova’s company Oceana Properties finalized the sale of her luxurious Dubai flat. A title deed obtained by ICIJ’s partner Paper Trail Media shows that a young British lawyer bought the apartment for about $1.6 million. It is not clear who handled the sale on behalf of Ignatova and pocketed the money. The lawyer who bought the property did not respond to reporters’ questions.

Ignatova remains on the FBI’s list of most wanted fugitives. The agency considers her to be alive “until there is documented evidence that she is dead,” a spokesperson told ICIJ.

Overall, the findings show how Dubai remains an attractive destination both for foreigners who want to invest in real estate in a low-tax jurisdiction and for money launderers who benefit from some local real estate agents’ “no-questions-asked” policy. Real estate investments also allow foreigners to obtain UAE residency if they buy one or more properties worth at least $545,000.

According to Jodi Vittori, a Georgetown University professor and illicit-finance expert, rules around property purchases in the UAE are more lax than those in other jurisdictions.

News investigations have repeatedly shown that property developers “were willing to take all-cash purchases; they would facilitate crypto purchases,” Vittori said. “It seemed that they were quite open to taking money from anybody and there weren’t very many rules of how to do that.”

The UAE authorities did not respond to the reporters’ specific questions but defended the country’s commitment to the fight against financial crimes. In an emailed statement to ICIJ’s British media partner, The Times, an official with the UAE’s British embassy said that the “UAE takes its role in protecting the integrity of the global financial system extremely seriously,” and that the country “works closely with international partners to disrupt and deter all forms of illicit finance.”

Clean reputation

The Dubai Unlocked revelations come as the UAE tries to clean up its image as a hub for illicit transactions. Numerous investigations and media reports have linked its banks, lax incorporation rules and free-trade zones to sanctioned individuals, corrupt politicians and gold and drug traffickers.

In 2022, the Paris-based Financial Action Task Force, an inter-governmental body that sets standards to combat financial crime, added the country to a list of jurisdictions under scrutiny for flaws in their anti-money laundering and anti-terrorism financing system. But early this year, the task force announced it had removed the UAE from the “gray list” in light of “significant progress,” including better cooperation with international anti-money laundering investigations. The task force acted at the urging of Germany, the U.S. and other Western countries despite concerns voiced by its own monitors for the UAE about the reliability of information provided by the government, according to Politico.

The fraud in Dubai is bigger than ever.

— Jonathan Levy, a lawyer representing OneCoin fraud victims

Soon after, the European Commission sought to remove the UAE from the EU’s own list of countries at high risk of money laundering, but the European Parliament blocked that proposal in April, citing “important and recent” evidence that the UAE facilitates financial crimes and the evasion of sanctions.

Unlike other notoriously secretive jurisdictions such as the British Virgin Islands, the UAE’s role as a critical military ally of the U.S. and a bulwark against terrorism in the Middle East have shielded the country from a greater degree of scrutiny by Western powers, according to some experts.

Vittori said she was “disappointed” but unsurprised that the UAE was removed from the list, owing to its political significance in the Middle East and zealous reputation-laundering efforts.

“That gives them a capability to avoid a lot of international scrutiny that a lot of other countries that weren’t so astute and didn’t have so much oil money and didn’t use it so well would be capable of,” Vittori said.

Fugitives and criminals

The review of Dubai land records by ICIJ and its media partners raises questions over the UAE’s commitment to implementing the reforms it promised to the global task force.

Like Ignatova, at least 11 of her associates owned some of Dubai’s most exclusive properties over the last nine years, the confidential data show. The buyers included OneCoin’s co-founder Karl Sebastian Greenwood, who is serving a 20-year sentence in the U.S. for his involvement in the OneCoin scheme; and Kari Wahlroos, a Finnish businessman who presented himself as OneCoin’s “European ambassador” at promotional events organized by the company. Greenwood declined to answer ICIJ partners’ questions. Wahlroos has not been charged. Asked about the properties in the leaked data, he confirmed to Finnish broadcaster YLE in a recent phone interview that he owned several apartments in Dubai. He also said he was on “really good terms” with Ignatova, but denied knowing that the company was used to launder money, as alleged by prosecutors. “I’ve never had a penny to do with OneCoin itself,” Wahlroos said.

Another OneCoin insider and Dubai property owner was Ignatova’s security counselor Frank Schneider, a Luxembourg national and former spy who escaped house arrest in France and is currently wanted by law enforcement.

Schneider owned a three-bedroom flat on the outer crescent of Palm Jumeirah, the Dubai land data show. According to Luxembourg magazine Reporter.lu and Swedish television broadcaster SVT, both ICIJ partners, Schneider sold his apartment in January 2022 while he was detained in France waiting to be extradited to the U.S. In 2023, he fled house arrest and became a fugitive.

Jonathan Levy, a London-based lawyer representing OneCoin fraud victims, says Dubai provided a haven for fraudsters and washes its hands of responsibility for their victims.

“The fraud in Dubai is bigger than ever,” said Levy. “There’s no government entity that would actually ever intervene on behalf of victims in a case like this.”

Maj. Sauod Almutawa, who works for the Dubai Police’s anti-money laundering unit, rejected any allegations that the UAE ー and Dubai in particular ー is a hub for financial crimes.

“Dubai is not a safe haven for illicit funds [and] for illicit actors,” Almutawa said in an interview with SVT.

Ruja Ignatova, pictured in the above wanted poster, is seen giving a speech at the OneCoin’s Wembley Arena event for investors pic.twitter.com/ggx5NazryM

— US Attorney SDNY (@SDNYnews) June 30, 2022

He added that the UAE authorities are “aware” of the risk posed by criminals and illicit proceeds flowing from foreign jurisdictions to the country. That’s why they are “super confident” that their response to cooperation requests from foreign law enforcement agencies is fast and well “beyond international standards,” he said. “As an assurance to our friends and strategic partners internationally, we will even continue to improve and bolster our international cooperation,” Almutawa said.

Besides the OneCoin fraudsters, the 2022 data reveal that dozens of criminals, including mafia bosses and individuals sanctioned for financing al-Qaida and other terrorist groups, bought luxurious flats, commercial real estate and parking lots in the Persian Gulf’s financial hub. Among them are Daniel Kinahan, a former boxing promoter who is accused by Irish and U.S. authorities of running a deadly global drug cartel from the UAE, and his wife, Caoimhe Robinson.

The dataset lists passport numbers, building names, room descriptions and other details of flats and commercial properties owned by individuals and companies. ICIJ and reporters participating in the Dubai Unlocked investigation cross-referenced the property data with the UAE registry of sale transactions from 1990 to 2023.

The records also show that even individuals who are the subject of an Interpol red notice — a request for a country to provisionally arrest someone — can be property owners in Dubai. For example, Isabel dos Santos, the wealthy daughter of Angola’s former ruler, is listed as the co-owner of a two-bedroom apartment near the Dubai waterfront. Since 2019, at least three countries have frozen dos Santos’ assets. Dos Santos, who denies wrongdoing, is banned from entering the U.S. due to her alleged “involvement in significant corruption” and was recently charged in Angola with 12 crimes, including embezzlement and fraud.

As a member country of Interpol, the UAE can decide to comply with the international police agency’s request and provisionally arrest her, but it’s not obliged to.

A ‘black hole’

In recent years, the number of countries signing extradition treaties and other deals with the UAE to tackle international crimes has increased. However, the country’s financial and corporate systems continue to represent a hurdle in lawyers’ efforts to chase criminals’ assets and help their clients recover lost money.

According to the anti-corruption group Tax Justice Network, the UAE is one of the world’s “most complicit [jurisdictions] in helping individuals to hide their finances from the rule of law.”

In 2021, ICIJ’s Pandora Papers investigation found that Dubai-based financial services providers incorporated shell companies for clients who wanted to keep their identities undercover. The companies’ beneficiaries included a Belgian tycoon accused of profiting from the smuggling of “conflict gold” from the Democratic Republic of Congo and a Canadian internet mogul convicted in the U.S. of laundering money for fraudsters, child p*rn traffickers and other criminals.

Still today, the UAE’s legal system is a “black hole,” said Levy, the lawyer for OneCoin fraud victims. Since 2021, UAE-registered companies have been required to disclose the identity of their true owners to authorities, but only the government can access the ownership information.

In the case of OneCoin, while U.S. authorities ordered co-founder Greenwood to forfeit $300 million, Levy said that other efforts to recover victims’ money are slow-moving and that the money lost in Dubai is “as good as gone.”

Contributing reporters: Luc Caregari (Reporter.lu), Eiliv Frich Flydal (E24), George Greenwood (The Times), Kevin Hall and Khadija Sharife (OCCRP), Axel Humlesjo and Diamant Salihu (SVT), Carina Huppertz (Paper Trail Media), Riku Roslund (YLE).