A Russian court has sentenced Liliya Nurieva, an executive of the notorious Finiko crypto scam, to three years in prison. This verdict marks a significant moment in what is considered the largest crypto fraud in post-Soviet history.
According to Izvestia, Nurieva, the former head of networks at Finiko, received a four-and-a-half-year sentence from the Vakhitovsky Court in Kazan on May 17. However, the court accounted for her time spent in pre-trial custody, effectively reducing her prison term.
Reduced Sentence and Appeal Plans
Prosecutors had initially sought a six-and-a-half-year sentence, while Nurieva faced up to 10 years before trial. She managed to secure a lesser sentence by striking a pre-trial agreement with prosecutors. Her lawyer announced plans to appeal the sentence, arguing that she was unaware of the fraudulent nature of Finiko when she joined the company.
Background on the Finiko Scam
Finiko, launched in 2018 as a supposed crypto investment fund, promised high returns of up to 30% on investments of $1,000 or more. The Russian Central Bank estimates that the firm defrauded citizens out of approximately $1.1 billion, much of which remains unrecovered. The project began to collapse in 2021, leading many of its leaders to flee abroad.
Interpol arrested co-founder Edvard Sabirov in the UAE in late 2022, while Kirill Doronin, the public face of Finiko, was detained in mid-2021. Despite these high-profile arrests, Nurieva is the first Finiko executive to be convicted and sentenced.
Fraudulent Operations and Collapse
Prosecutors argued that Finiko operated as a Ponzi scheme, using new investors’ funds to pay returns to earlier investors. The platform faced instability in early 2021, leading to payment delays and eventual suspension in June. This caused the value of its issued crypto asset to plummet and resulted in the abrupt closure of its offices.
Investors and Legal Proceedings
Nearly 10,000 people were reported to have invested in Finiko. The trial attracted several of these investors, including Lyudmila Yamshchikova from Kazan, who invested nearly $11,000 and relied on returns to pay her mortgage. She described the sudden cessation of payments and the widespread financial impact on her community.
Nurieva’s lawyer emphasized her client’s ignorance of the scam’s nature, stating she had invested her own money and only realized the fraudulent activities during later interactions with senior executives.
This case highlights the extensive reach and devastating impact of Finiko’s fraudulent operations, with ongoing legal battles likely to continue as authorities and investors seek justice and recovery of lost funds.