Binary options fraudster Lee Elbaz faces lifetime sentence, seeks release ahead of sentencing

Maria Nikolova

The US government estimates that Elbaz’s advisory sentence will be life imprisonment, which reflects not only the substantial losses caused by the fraudulent scheme but also enhancements for her role as a leader of the scheme.

Binary options fraudster Lee Elbaz, the former CEO of Israel-based Yukom Communications, wants to be released pending her sentencing in the United States. This becomes clear from a brief submitted by the US Government at the Maryland District Court on September 4, 2019.

The government has filed the brief in opposition to the Defendant’s Motion for Expedited Reconsideration of Order Revoking Bail. The US authorities argue that Elbaz’s request for release pending sentencing should be denied.

What becomes clear from the Government’s Brief is that Elbaz wants out before her sentencing which is due in December this year. She is suggesting that she post additional bond secured by collateral located in Israel. But the US Government stresses that pledging an additional $1.189 million in collateral would not alter the analysis in this case, particularly where the government has still not located over $100 million in fraud proceeds.

The government objects to the suggestion that pledging collateral located abroad would be sufficient to guarantee the defendant’s appearance or appropriate in this case. Simply put, it would be extremely difficult, if not impossible, for the government to seize assets located abroad in the event the defendant decided to flee. Pledging these assets as collateral thus provides no assurance of the defendant’s appearance for sentencing.

Between May 2014 and June 2017, Elbaz orchestrated a scheme to defraud tens of thousands of binary options clients out of over $100 million. As a manager and CEO of Yukom Communications, Elbaz was responsible for hiring, training, and overseeing dozens of employees. As the evidence at trial showed, the defendant trained her employees and co-conspirators to lie to clients about, among other things: whether investors made money in binary options; the nature and safety of “investments” in binary options; gains and rates of return clients could expect to receive; the alignment of financial interests between Yukom and its clients; the education, credentials, and experience of the defendant and her employees; and whether clients could withdraw funds from their accounts. At the defendant’s direction, her employees lied to clients and used other fraudulent tactics to convince clients to send money and to prevent clients from withdrawing their funds.

On August 6, 2019, the jury unanimously convicted Elbaz on all counts.

The statutory maximum sentence for each of the four counts of conviction is twenty years. The government estimates that the defendant’s advisory sentence will be life imprisonment, which reflects not only the substantial losses caused by her scheme but also enhancements for her role as a leader of the scheme, using of sophisticated means to defraud investors, causing substantial financial hardship to victims, and targeting vulnerable victims.

The Government argues that, given her conviction and potential lengthy sentence, Elbaz has a strong motive to flee and her lack of flight to date is simply not sufficient to establish that she will remain in the United States now that she has been convicted and faces a substantial sentence.

Read this next

Metaverse Gaming NFT

Astar Network’s ad features 329 top brands to support Web3 in Japan

Blockchain innovation hub Astar Network is making strides in promoting the Web3 adoption worldwide. In yet another milestone, the smart contracts platform has run a national newspaper ad in Japan that set a new global record with participation from 329 blue-chip firms.

Digital Assets

Pyth Network welcomes onchain data from crypto market maker Auros

“By sharing our high-frequency trading data with a truly onchain decentralized network, we aim to foster innovation that will lead to better financial solutions for all participants.”

Digital Assets

Tokeny integrates Ownera to boost liquidity of tokenized assets

“The adoption of FinP2P will result in higher liquidity and better access to capital and assets by providing regulated firms with one secure point of connection to multiple digital asset networks across the globe.”

Digital Assets

BingX launches subsidy vouchers to cover user losses in copy trading

“With the introduction of copy trade subsidy vouchers, new users can easily try out trading strategies without incurring losses.”

Digital Assets

Talos expands sales team: Frank van Zegveld, Matt Houston, Hillary Conley

“The extensive leadership and industry expertise of these new hires will enable us to build long-lasting relationships as we continue to build out our global presence in EMEA and beyond.”

Executive Moves

FX and CFD broker Emporium Capital hires industry veteran Robert Woolfe as COO

His past experience within the FX and CFD industry includes top roles at Capital Index, London Capital Group, GKFX, ETX Capital, and IG.  “I’m delighted to be part of the Emporium Capital team and spearheading the brokerages global expansion plans”, he said about the appointment.

Retail FX

Hantec Markets wins six categories at Global Retail Forex Awards 2022

Hantec Markets has recently rebranded with a new website and a renewed growth strategy that features the #TimeToStrike hashtag to signify a time of renewed growth for the broker.

Industry News

Nexo sued for operating crypto brokerage without license and lying about it

“Nexo violated the law and investors’ trust by falsely claiming that it is a licensed and registered platform. Nexo must stop its unlawful operations and take necessary action to protect its investors.”

Industry News

Apex Group launches EU Taxonomy Solution as part of ESG offering

“Enabling our in-scope clients to demonstrate alignment with the EU Taxonomy is only the beginning – with over twenty green taxonomies in place, in development or under discussion worldwide it is crucial that investors act to understand and report taxonomy alignment data sooner, rather than later.”