Thirteen years ago, Israeli businessman Guy Grinberg was a high-tech hero. Kulanu, the social networking startup he co-founded, was featured in the interview CNBC and Bloomberg.
his company was is appreciated As an example of Israeli entrepreneurship in the 2009 book “Start-up Nation: The Story of Israel’s Economic Miracle”.
The book states, “China’s third-largest social networking website, which serves the country’s 25 million young web surfers, is actually an Israeli start-up called Koolanu, which in Hebrew means ‘ We all’.”
But on Wednesday, October 6, after an arrest by Israeli police at the behest of the FBI, Grinberg was brought to Tel Aviv Magistrates’ Court for a remand hearing. According to an October 6 statement from Israeli police, Grinberg is a suspect in alleged large-scale fraud and money-laundering crimes related to digital forex trading.
In a joint covert operation with the FBI, Israel Police arrested 26 people suspected of involvement in Tel Aviv on Tuesday-Wednesday night.
Of these, only two suspects have been named in court filings produced before their remand hearing. These are Grinberg, 47, and Snir Moshe Hanya, 33.
The police statement said the alleged cryptocurrency crimes involved victims overseas and amounted to millions of shekels. Police, without giving further details about other locations, said the arrests were part of a coordinated campaign by multiple law enforcement agencies around the world to detain people suspected of financial crimes.
An FBI spokesperson confirmed to The Times of Israel that the FBI is working on an ongoing investigation with the Israeli Police as well as the National Police of Ukraine.
Guy Grinberg’s LinkedIn profile describes him as “Vice President of Business Development” for an undisclosed forex company. A recent post “Looking for Live Crypto CFD Leads!” was read. This means that he was looking for the contact information of potential investors in online cryptocurrency and CFD products.
From 2012-2014, Grinberg worked for Furniture, the ominous social networking startup of entrepreneur Moses Hoegg, according to his profile.
From 1996 to 2003 he worked as an “Assistant Manager” at Camden Market Properties and Holding, which was founded by Bebo Kobo, an Israeli-Bulgarian businessman and father of Kulanu Odi (Oded) Grinberg’s partner in Kobo. In 2014, Bebo Kobo sold a large part of Camden Market to Israeli businessman Teddy Sagi.
Guy Grinberg with his business partner Odie Kobo in 2008 (Facebook screenshot)
According to Channel 12 News, most of those arrested have claimed that they are not aware of any fraud. The company he worked for is said to have attracted workers with the promise of higher wages for those who were committed to working hard.
Israel has been a major center of online investment scams, which also operate from Cyprus and throughout Eastern Europe.
When the binary options industry was outlawed through the Knesset law in October 2017, it was largely the result of investigative reporting by The Times of Israel, which began with a March 2016 article titled “wolves of tel aviv“Some scammers have moved to forex trading or cryptocurrency speculative schemes.
Israeli law enforcement officials prosecute almost no online investment fraudsters, despite the fact that the industry employs thousands of Israelis who have duped victims worth billions of dollars worldwide.
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