The criminal organization around Gal and Marina Barak, Uwe Lenhoff, Gery Shalon, Vlad Smirnov and their service providers (call centers, marketing affiliates, payment service providers) defrauded tens of thousands of innocent retail investors with their fraudulent websites (optionstarsglobal, xtraderfx, safemarkets, cryptopoint, goldenmarkets, zoomtrader, option888, xmarkets, tradovest, tradeinvest90) during the years 2015 – 2019. Since the arrest of Uwe Lenhoff (died in prison as of July 6th, 2020) and Gal Barak in January 2019, the prosecutors and courts are busy in Austria, Germany and Netherlands (there is an ongoing criminal investigation against BOOKER/PAYVISION – the main Payment Service provider for Barak and Lenhoff). Below you find a summary of the trials in Germany and Austria. For Gal Barak´s verdict pls find more details here. For the (still unbelievable) acquittal of his wife Marina Barak, pls refer here.
The indictment and verdict of Zacharias Fitzelton (call center guy in charge of Gal Barak´s brands)
Based on the joint investigation with the investigating authorities in Austria, which led to the indictment and conviction of Gal Barak for aggravated fraud and money laundering at the Regional Criminal Court in Vienna, Austria, on 1 September 2020, the General Public Prosecutor’s Office in Bamberg, Germany, brought charges against Israeli Zacharias Fitzelton on 9 August 2021 under case number: 730 Js 1545/18.
The indictment charged the defendant, Zacharias Fitzelton, with being part of a group of dozens of perpetrators who knowingly and willfully conspired to commit fraud in cybertrading platforms on a continuing basis. Zacharias “Jackie” Fitzelton was in charge of the “retention” department of the call center in Sofia, Bulgaria, within Gal Barak’s fraud organization. The employees of this call center enticed victims of Gal Barak’s fraud platforms to make further deposits. According to the indictment, Gal Barak, who was the head of the gang, had decisive responsibility within the group of perpetrators. The top management with operational responsibilities also included Marina Barak (Andreeva until mid-2019), Gal Barak’s wife, Zacharias Fitzelton and other individuals.
The indictment against Zacharias Fitzelton describes the crime in detail. Furthermore, the role of the financial service providers, who are part of a money laundering network installed throughout Europe, is also addressed.
As the indictment states, Gal Barak’s cybertrading platforms were purely fraudulent websites where investors never had a chance to get their invested capital back or even to make any profits.
The individual platforms operated by this criminal organization are named on page 4 of the indictment against “Jackie” Fitzelton. In addition to the platforms “optionstarsglobal” (www.optionstarsglobal.com) and “safemarkets” (www.safemarkets), the platform “xTraderFX” (www.xtraderfx.com) is also listed.
On 3 March 2022, Zacharias Fitzelton was sentenced to six years and 10 months imprisonment by the Munich I Regional Court – Criminal Division – on the basis of the main hearing in the proceedings under case no.: 4 KLs 730 Js 1545/18.
The indictment and verdict of Azem Spahiu (in charge of marketing of Uwe Lenhoff´s brands)
On 3 May 2022, the trial against Azem Spahiu, a Kosovarian, began before the Grand Economic Criminal Chamber at Saarbrücken Regional Court. The public prosecutor’s office in Saarbrücken also accused Azem Spahiu of being part of commercial gang fraud in the criminal proceedings under file no.: 2 Kls 2/22. Azem Spahiu was actively involved in the promotion of the fraud platforms option888, xmarkets, ZoomTrader, etc., which were under the economic ownership of Uwe Lenhoff. On these platforms, innocent retail investors invested in various financial products, as they were promised the possibility of high profits by the employees of these platforms. The beneficial owners of the platforms did not invest in financial products at all. But used the money collected from the investors for their luxury lifestyle. Azem Spahiu was found guilty and was sentenced to twelve years imprisonment in August 2022.
Paul Lopatin (he administered dozens of bank accounts on behalf of the PSP´s managing the money laundering network for Barak and Lenhoff)
On 29 October 2019, charges were brought against Paul Lopatin by the Düsseldorf Public Prosecutor’s Office at the Düsseldorf Regional Court under Case No.: 130 Js 29/19. According to the indictment, until his arrest on 08 February 2019, Paul Lopatin was involved in a professionally organized group whose business model provided for fraud platforms such as “optionstarsglobal”, “xTraderFX”, “xmarkets,” and “options888” so-called German “premium bank accounts”. Lopatin reported incoming funds to the respective users of these “money laundering” services on a daily basis and then forwarded them worldwide – almost exclusively abroad – using the mTAN procedure, in order to finally withdraw them from the access of the depositors. During the raid at Lopatin´s place, countless bank accounts were identified, mainly at Deutsche Bank, for the “administration” of which Paul Lopatin was responsible. Paul Lopatin was held criminally responsible for the “administration” of four incriminated accounts at Deutsche Bank, including Workplace Consult GmbH and Condesk GmbH accounts. Both accounts were used by the fraud organization of Gal Barak and Uwe Lenhoff as collective accounts for the deposits to the fraud websites of Gal Barak and Uwe Lenhoff.
Paul Lopatin was sentenced to four years imprisonment for money laundering in combination with aiding and abetting the provision of financial services without a licence in 136 cases.
Indictment and verdict of Sebastian Morelli in Salzburg (a call center guy in charge of Gal Barak´s brands)
In May 2022, a Kosovar guy known by his alias of Sebastian Morelli (alias name) to many victims was sentenced to 18 months in prison. His sentence was lowered due to his confession.
The indictment of Ilan Tzorya, Micha Golod and others
The trial of Ilan Tzorya, Micha Golod and others (38 Hv 44/22p) is currently taking place at the Salzburg Regional Court in Austria. The defendants there are accused of serious fraud and money laundering by the Vienna Public Prosecutor’s Office. The defendants were co-owners and operators of the software company Tradologic, which provided the software for the fraud websites of Gal Barak and Uwe Lenhoff.
On September 8, 2023, Ilan Tzorya was convicted of significant fraud charges and received an 8-year prison sentence. Similarly, Micha Golod was also convicted on serious fraud allegations and was handed a 6-year prison term. It’s important to note that these verdicts are still pending finalization. Both Tzorya and Golod have not accepted the judgments and continue to deny any involvement in fraudulent schemes.
Upcoming trials in Germany for Gal and Marina Barak, Gery Shalon and Vlad Smirnov
After serving part of the prison sentence, the remainder of Gal Barak´s sentence was suspended as of 29.01.2021. However, by decision of the same day, Gal Barak was taken into Austrian custody pending surrender on the basis of a European Arrest Warrant issued by the Bamberg District Court on 11.11.2020. The German arrest order charged Barak with forming a criminal organization and investment fraud. Before the Bamberg Regional Court, Gal Barak was charged with fraud offenses and offenses under section 129 of the Criminal Code. He defended himself against this on the grounds of the alleged violation of the prohibition of double jeopardy “ne bis in idem,” in the context of which the Higher Regional Court of Bamberg posed questions to the ECJ on the compatibility of Article 55 of the CISA with the Charter and on the applicability of the exception to the ne bis in idem principle allowed therein to pure property crime.
THE ECJ´s judgement
In its judgment of 23.03.2023, Ref.: C-365/21, the ECJ confirmed the legality of the exception provided for in Art. 55 I b) CISA. The security of a Member State or equally essential interests may prevail in individual cases so that a different objective is pursued with the renewed prosecution of the same offense than with the first prosecution of the offence. The encroachment on Art. 50 of the Criminal Code was therefore proportionate, in particular due to the crediting provision of Art. 56 of the Schengen Convention. In the case of purely property-damaging activities, state interests are not necessarily impaired to the necessary extent, but it is not per se excluded that the state itself is harmed and thus the exception to the prohibition of double jeopardy can apply.
In addition to answering the questions, the ECJ gave guidance to the OLG Bamberg on the interpretation of the idem criterion. Thus, an identical substantive offense would not exist if the conviction only related to fraudulent acts against injured parties residing in Austria but not to acts to the detriment of persons residing in Germany. In this case, the facts were only similar and the principle ne bis in idem was therefore not applicable. On the other hand, the legal classification of the act according to national law was not decisive for determining whether the act was “the same”, as the scope of protection of Article 50 of the Criminal Code could not differ from one Member State to another.
Gal Barak and his accomplices like Marina Barak, Gery Shalon, and Vlad Smirnov will face criminal proceedings before the Bamberg Regional Court in the upcoming months for forming a criminal organization and defrauding thousands of innocent European citizen.