Lee Elbaz wearing a star of David, arrives at federal court in Greenbelt, Md., Tuesday July 16th, 2019. Elbaz was CEO of an Israel-based company called Yukom Communications. She has been convicted of engaging in a scheme to dupe investors through the sale and marketing of financial instruments known as “binary options.”
US jails Israeli binary options crook Lee Elbaz for 22 years; must repay $28m
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
ELBAZ TO APPEAL BOTH CONVICTION AND SENTENCE
By ERIC CORTELLESSA and SIMONA WEINGLASS
19 December 2019
Lee Elbaz, an Israeli woman convicted in August 2019 for binary options fraud, enters the Greenbelt, Maryland courthouse on July 25, 2019. Behind her is Larry Burton, an American man who testified during the trial that he lost $140,000 to the Israeli-run website BinaryBook.com (Photo credit: Times of Israel)
Lee Elbaz, an Israeli woman convicted in August 2019 for binary options fraud, enters the Greenbelt, Maryland courthouse on July 25, 2019. Behind her is Larry Burton, an American man who testified during the trial that he lost $140,000 to the Israeli-run website BinaryBook.com (Photo credit: Times of Israel)
GREENBELT, Maryland — 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, who has been in jail since her conviction in August, was brought to the court in an orange jumpsuit. She sobbed intermittently throughout the hearing, and grasped the arm of one of her attorneys as the judge announced the sentence.
Defense attorney Barry Pollack said his client would appeal her conviction and sentence, which he called “much harsher than it needed to be.”
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.
Elbaz was the CEO of Yukom Communications Ltd., one of more than a hundred binary options companies that operated in Israel between the years 2008-2018.
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.”
Fifteen additional defendants were indicted in November.
Yukom employees pretended to be from other countries, lied about their professional qualifications and adopted “stage names.” Elbaz used the alias “Lena Green” while interacting with investors, according to prosecutors.
Yukom employees also falsely guaranteed profits, lied about their historical rates of return, and didn’t tell investors that they only made money if their customers lost money, prosecutors said.
An email instructed BinaryBook sales representatives to target retirees, Social Security recipients, pension holders and veterans as clients, according to court filings accompanying guilty pleas by former employees.
Justice Department prosecutor Henry Van Dyck said most of the victims lost everything they invested. “Nobody was looking out for these investors,” he said. “They were rooting against them.”
He said that videos from inside Yukom showed that employees enjoyed their work, and that Elbaz fostered a work environment where it was fun to defraud investors.
“There was a mentality at this company that the defendant fostered, with gongs and bells, to say this is exciting, it’s a good thing to defraud investors. That culture that permeated company is no doubt one of the reasons why this fraud grew from a few hundred thousand dollars and a few employees to hundreds of employees and millions and millions of dollars in losses to investors,” he said.
During the hearing, Judge Chuang read off a long list of victims who had lost their life’s savings as a result of Elbaz’s actions.
“Among such victims was Larry Burton, who lost over $200,000 including $70,000 from his retirement account. He also borrowed 30,000 for his investment and afterwards had to refinance his home. There’s James Freeman, age 67, who lost $304,000, his entire life savings. Terry Pocket lost $247,000 including $94,000 from his 401k fund. He also said he lost his life’s savings and had to borrow money to pay for his mortgage. Mr. Hanow lost $175,000 including large sums from his IRA and retirement funds and had to take a job as a truck driver to help pay off his losses.”
The judge continued to enumerate victims, including a man who “lost so much money he tried to commit suicide.”
The judge said that Elbaz and others specifically targeted vulnerable people, including the elderly, and tried to get people addicted to trading like in a casino. He said that Elbaz would suggest that clients use their retirement funds for investments.
Elbaz’s lawyer tried to persuade the judge that she was “middle management” and that her bosses Yossi Herzog and Kobi Cohen were the heads of the conspiracy. Herzog and Cohen, who have both been indicted, are still at large.
“Yes, there was harm done here,” defense attorney Pollack said. “But not all of that harm can be laid at Ms. Elbaz’s doorstep.”
Pollack had asked for a sentence of five years in prison for his client. Prosecutors recommended a prison sentence of nearly 34 years, the top of the sentencing guideline range for Elbaz’s case.
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.
Nimrod Assif, an Israeli lawyer who has sued several binary options companies on behalf of victims, said in response to Elbaz’s sentencing, “I estimate that hundreds, if not thousands, of Israelis were engaged in pretty much the same conduct for which Elbaz was convicted and sentenced. Their fate is different only because they did not target Americans, or haven’t been caught. If Israeli law enforcement authorities had done their job, we wouldn’t have come to this sad day.”
been-there wrote: ↑Mon Aug 05, 2019 4:48 am.
That the following news-story is yet another big story that isn't getting any coverage in the west, I regard as yet another sign that non-Jewish media outlets have been successfully intimidated by the weaponised anti-semite slur.
In addition to the troubling western news-media silence towards this story, is that this story appears to be yet more evidence that a common conditioning of Israelis is an upbringing in a society that justifies lying, cheating and ripping-off of non Jews.
Here is the headline that you won't see in the media:
AMERICAN-ISRAELI JEW OPERATING FROM ISRAEL, WAS DIRECTLY RESPONSIBLE FOR $2.4M IN INVESTOR LOSSES
Whereas the Jewish-Israeli newspaper I have taken this from has a headline and angle that tries to imply she is a good person now doing the right and noble thing.
The defence lawyer for the CEO Lee Elbaz is using a very revealing tactic.
He is basically arguing that since Liora Welles had a job that entailed professional lying and cheating from Israel, and was good at it, how can the jury know whether Liora Welles is lying in court?Elbaz’s defense lawyer, Barry Pollack, depicted Welles as a skilled liar and manipulator who was fingering her former boss, Elbaz, in an effort to get a lighter sentence.
“You were a very good salesperson at Yukom; you were good at lying to people?” Pollack suggested.
“Mr. Pollack, that was part of the job,” she replied.
“And you were good at it?”
“I’m taking responsibility, I’m here, aren’t I?” said Welles.
“Telling people what they want to hear is part of being a salesperson,” said Pollack. “And these are the people that you most need to sell?” he asked, gesturing towards the prosecution attorneys.
“I had a choice to come back here. I came back and took responsibility. I knew I might be charged,” she said.
“If you had stayed in Israel you could have been extradited?” suggested Pollack.
“I don’t know,” said Welles, “I hear the laws of extradition are pretty hard.”See the whole article here:Convicted binary options operative: ‘I’m taking responsibility for what I did’
Liora Welles is just one of thousands of Israelis who worked in widely fraudulent industry
Convicted American-Israeli binary options fraudster Liora Welles pleaded guilty to conspiracy to commit wire fraud in December 2018, and as part of her plea deal agreed to cooperate with US prosecutors and to testify at court proceedings or trials on the government’s behalf.
On July 22 and 23, Welles testified on behalf of the prosecution at the trial of Yukom Communications CEO Lee Elbaz, who was indicted by a US federal grand jury in March 2018 for allegedly participating in a $145 million scheme to “defraud investors in the United States and across the world”.
Lee Elbaz wearing a star of David, arrives at federal court in Greenbelt, Md., Tuesday July 16th, 2019. Elbaz was CEO of an Israel-based company called Yukom Communications. She is accused of engaging in a scheme to dupe investors through the sale and marketing of financial instruments known as “binary options.”
All sales agents claimed to have expertise in the stock market and financial trading, she said, and they claimed to be calling from London, as opposed to Israel.
Pollack showed Welles an email that had been sent to employees by management.
“We all have goals to reach but naturally not at all costs,” it read. “We are a company that works towards being clean and orderly. We do not charge clients credit cards without their approval and we do not charge by making false promises.”
“Did Yossi Herzog tell people to work clean?” Pollack the defence lawyer asked Welles.
She replied: “The company’s definition of clean is not Webster’s definition of clean. The company had its own internal dictionary. It meant work convincingly and manipulatively. It meant telling better, more convincing lies.”
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.
Despite the fact that thousands of Israelis were employed in the binary options industry, Israeli prosecutors have to date only indicted three, for their role in a separate alleged fraud.
https://www.timesofisrael.com/convicted ... HNc9HYuh4E
