Moshe Hogeg, the Israeli crypto mogul behind the blockchain smartphone startup Sirin Labs and a host of other crypto startups, was reportedly arrested on Thursday on fraud and assault charges, according to multiple local news outlets.
Isreali news publication Haaretz reported that Hogeg was arrested along with seven other individuals, including Hogeg’s former and current partners or employees.
A statement published on the official Twitter page of the Israeli police on Thursday said in Hebrew that “eight suspects were arrested on suspicion of committing fraudulent offenses in the field of cryptocurrencies, amounting to hundreds of millions of shekels,” although it did not name any of the suspects.
According to Haaretz, the eight suspects, which include Hogeg, are accused of a number of offenses including conspiring to mislead investors, theft and money laundering. The Jerusalem Post said he was arrested, along with a family member, at the office of the Premier League football club he owned, Beitar Jerusalem.
A post on Hogeg’s official Facebook page said he had to postpone an event about non-fungible tokens (NFT) that was scheduled for Thursday. A previous post by him says around 1,300 people had registered to attend the event.
Financial fraud allegations against Hogeg have been mounting for years. A 2019 report by CoinDesk took a closer look at a number of lawsuits against Hogeg, who was behind failed initial coin offerings (ICO) including Stox and Leadcoin.
A former employee at one of Hogeg’s businesses, who spoke on condition of anonymity, told CoinDesk that “we all heard rumors” about Hogeg but few interacted with him directly.
“Every payday, when the money would actually show up in my bank account was a huge relief and when the company inevitably collapsed, none of us were surprised,” the former employee said.
In 2020, Hogeg was sued for $6 million over unpaid Sirin Labs bills. Earlier this year, two of Hogeg’s childhood friends and former employees sued him for 18 million new Israeli shekels (around US$5.8 million) for money owed over failed investments. In September, according to Times of Israel, Hogeg suddenly decided to put up Beitar Jerusalem for sale citing “racist fans” after he failed to sell half the team to an Arab investor.
A document circulating around the internet and reviewed by CoinDesk lays out 15 offenses against Hogeg including conspiracy to commit crime, falsifying corporate documentation, as well as a number of offenses related to sexual assault. In early November, an Israeli model accused Hogeg of sexually assaulting her years ago when she was still 17 years old. According to Times of Israel Hogeg denied the allegations, adding that the model’s accusations were part of a smear campaign.
“This morning, dozens of police officers raided the homes and businesses of detainees and a number of detainees, in order to gather evidence and seize exhibits related to the investigation,” Israeli police tweeted.