Judge says CEO in $140m fraud targeted elderly, vulnerable victims; as she sobs, her lawyers claim she was ‘middle management,’ point finger at her bosses Yossi Herzog, Yakov Cohen
By Eric Cortellessa and Simona Weinglass | 19 December 2019
THE TIMES OF ISRAEL — Israeli binary options fraudster Lee Elbaz was sentenced to 22 years in prison by a court here on Thursday.
US District Judge Theodore Chuang told Elbaz, 38, that her actions cost vulnerable investors their life savings, homes and even their marriages. “This was a very significant crime with significant harm to victims,” the judge said.
The judge further ordered Elbaz to pay $28 million in restitution to her victims. The government has 90 days to find more victims, which may raise the restitution amount. …
Elbaz was found guilty by a Maryland jury on August 6 on three counts of wire fraud and one count of conspiracy to commit wire fraud in connection with a vast scheme to defraud investors all over the world out of more than $140 million. …
She is one of 21 indicted defendants who worked for Yukom, which operated the websites BigOption and BinaryBook, and was the first to be tried. Elbaz was arrested by the FBI on September 14, 2017, as she got off a plane at JFK airport in New York. She was indicted by a US federal grand jury in March 2018 for participating in a scheme to “defraud investors in the United States and across the world.” …
Binary options fraud flourished in Israel for about a decade before the entire industry was outlawed via Knesset legislation in October 2017, largely as a result of investigative reporting by The Times of Israel that began with a March 2016 article entitled “The wolves of Tel Aviv.” At its height, hundreds of companies in Israel were engaged in the widely fraudulent industry, employing thousands of Israelis, allegedly fleecing billions out of victims worldwide.
Many of the fraudulent operatives have since moved their operations abroad, or switched to other scams, though Israeli law-enforcement authorities have proved unwilling or unable to prosecute more than a handful of alleged offenders. By contrast, the US government is ratcheting up efforts to bring Israeli offenders to justice. […]
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