Unfolding the mystery behind Instaforex real owners and activities

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The 2014 “rebranding” of the British Virgin Islands Admiral Markets Ltd company into Proservicecom Ltd required a name change in a bank : SEB.

Therefore, partners of Admiral Markets Ltd / Proservicecom Ltd were required to communicate the new bank details so that this British Virgin Islands company could keep on receiving its money in Estonia.

Here are the details of the account :

Beneficiary: ProServiceCom Ltd.
Beneficiary's Address: Akara Bldg, 24 De Castro Street, Wickhams Cay 1, Road Town, Tortola, British Virgin Islands
Beneficiary's Bank: AS SEB Bank
Bank address: Tornimae 2, Tallinn 15010, Estonia.
IBAN / account number: EE631010220054344016
SWIFT code: EEUHEE2X

What is interesting is that this change of account holder name did not affect all bank accounts operated by Admiral Markets, other accounts, in popular offshore locations, remaining under the same name.
Maybe because these exotic accounts were operated by Admiral Markets “clean” entities, and didn't need such an update ?

It would not be the first time that Admiral Markets fails to report business transactions. In 2018, it received a slap on the wrist from the Estonian financial services regulator for operating unreported transactions through its Czech Republic entity (see attached file).

It seems like Estonian authorities are being requested by multiple international authorities to investigate how dirty money from Russia can have flowed into the European and North American economies to the tune of 200 billion dollars.

It seems also that, for the moment, the Estonian investigation, which has led to the demise of Danske Bank, the arrest of members of the management of Tallinn Business Bank, and to an investigation into Swedbank, has not taken into account the second largest bank in Estonia : SEB.

Maybe it is time to do so ?

 

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Czech Republic, where a certain Sergey Mayzus has established himself as a local tycoon and entertains extremely good relationships with a variety of banks, is one of the main European banking hubs of this little group of colluding individuals, along with Bulgaria, where they enjoy strong local support facilitated by the high level of corruption, resulting into banks turning a blind eye on the source of funds and operations on the accounts.

But even these do not offer the degree of comfort offered by Estonian banks, due to the combination of three main factors :

• advanced e-banking facilities, allowing cheap and fast transfer of funds in between accounts and banks within the country,
• complacency of banks and authorities, which saw the massive influx of money as a way to sustain the “Estonian miracle economy” and encouraged, through their public policy of granting “crypto” financial licenses to anyone with a pulse and a clean criminal record, the fraudulent cryptocurrencies boom,
• connections with a variety of actors, from rogue officials to complicit law firms and accountants, allowing to create hundreds of short lived shell companies operating without ever reporting, and vanishing without traces once their mission performed.

And of course, Instaforex, the cornerstone of Mayzus empire, has made extensive use of these facilities, in the same way that their fellow colluding brokerages have, and even more.

The difference with other brokers is that Instaforex activity does not only consists into fleecing traders.

Under the cover of an offshore brokerage, Instaforex is in fact offering to its clients a money laundering powerhouse equipped with all the necessary features : anonymous accounts, anonymous e-wallets, anonymous debit cards.

Accounts can be funded by a variety of methods, but the most popular at Instaforex remains the use of trusted partners, who are converted from the ranks of the Investment Brokers into “introducing offices”, who are collecting funds through a variety of methods, from local bank transfers to cash remittance, the most performing and faithful of them even being given the opportunity to setup their own semi-autonomous shop.

 

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Let’s meet for an example a top achiever at Instaforex Indonesia : Kerry Sumbadji.

In spite of the fact that Instaforex is blacklisted in Indonesia, Kerry Sumbadji has for a long time acted as first an IB and then an Introducing Office for Instaforex, and has, from his personal bank account, sent hundreds of thousands of dollars a year to Instaforex.

Then, as a warm thanks from Instaforex, he got promoted into the organization, and got the opportunity to operate its own semi-autonomous brokerage : firewoodfx.com , as shown by the registration of the corresponding brand in Indonesia.

Of course, as a coincidence, guess where this Saint-Vincent and Grenadines brokerage is being registered ?

Yes, you’re right : Suite 305, Griffith Corporate Centre, Kingstown, Saint Vincent and the Grenadines.

Oh, and it operates of course through a UK phone number. Because, yes, you can trade from all over the world (except, officially, from the United States : wink ).

For an example, you can use local payments to a certain bank in Thailand, thanks to the connections established there by a certain Alexey Skachilov.

Or, of course, you can use Mayzus’ OKPay too.

And, last but not least, becoming a semi-autonomous broker in the Instaforex / Mayzus family allows you coverage from the prestigious EuropeanCEO publication.
Yes, the same Mayzus connected EuropeanCEO which granted the "Best ECN broker 2017 award" to the Mayzus connected Instaforex, and peddles equally connected newcomers such as OctaFX.

 

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So, now you have funded your anonymous account at Instaforex using a deposit made, for an example in cash, at your local Instaforex Office, what type of benefits can you enjoy ?

Well, first things first, you can enjoy an Instaforex branded debit card, as anonymous as your account is.

Let’s see how the Introduction Office of Instaforex in Pakistan explains to clients the main added value of this card:

 

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“operations with the prepaid card are totally confidential, no information is provided to a tax or regulatory authority of any country”.


How convenient.

And, no, this is not some random guy operating out of control of Instaforex and having turned rogue.

The honorable Dr Zia-al-Hassan is a close acquaintance of a key player at Instaforex, formerly “Director of Business Development for Asia”, German Pavlyak.

In fact, he is so close to German Pavlyak that he decided, as a parting gift when German Pavlyak changed position within the organization in 2016 (to take care of Forexmart), to dedicate him a full post on his blog “ forexguru” :

 

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Of course, your anonymous Instaforex card, connected to your anonymous Instaforex account is also connected to your equally anonymous “Insta Wallet”.

And this is where things which were so far just nice and sweet are really becoming fantastic : Insta Wallet allows transfers of funds in between wallets of different users, to the tune of 2,500 USD a day.

That is 75 000 USD per month per wallet, folks.

And of course, you can own multiple anonymous accounts, multiple cards and multiple wallets, if you are really serious about moving money in a way that is totally confidential because, again “no information is provided to a tax or regulatory authority of any country”

And it seems that many customers of Instaforex have taken the route of doing exactly this.

Let’s take for an example Kristína Vencelová, a Czech citizen who, according to information made available in a certain ongoing civil procedure, was, through several companies, a client of instaforex.com.

It appears that Ms Vencelová had perfectly understood the advantages offered by Instaforex, and these were certainly of a great use for her in order to launder the money obtained from her illegal activities performed over a decade, and for part of which (1.5 million euros substracted from over 2 000 Czech citizens) she was imprisoned in 2014 (see attached file).

Of course, the benefits offered to Ms Vencelová pale in comparison to the ones offered to Iran residents, companies or officials, which, thanks to Instaforex (and other related brokers such as the Vladimir Syrov managed Superforex, which is targeting specifically this country and offering its own wallet system, "Superforex Money") can escape international sanctions and move their money to any number of undisclosed recipients across the world, with the insurance that “no information is provided to a tax or regulatory authority of any country”, including US Treasury, OFAC, etc.

 

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So, if you really still think that Instaforex is simply only in the business of fleecing traders, you are very very wrong.
Instaforex, which was one of the main beneficiaries of the Liberty Reserve money laundering machine, simply took over when Liberty Reserve was arrested by FBI.

 

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Beyond harbouring the money laundering endeavours of various unsavoury characters, launching scores of equally unregulated and fraudulent “independent” forex brokers and partaking into the multibillion dollars heist which has been at the heart MtGox / Btc-e / WEX saga, the Instaforex - Mayzus (and related) organization has been, and is still, a major player in what is probably one of the biggest financial scams ever : the fraudulent ICO boom.

For the ones who do not know what are ICOs, this term means “Initial Coin Offering”, or, otherwise put, the sale to the public of newly issued cryptocurrencies supporting blockchain based businesses at different stages of development.

More often than not, the stage of development these businesses are in is close to nil, the business model itself is quite dubious, and the whole “valuation” of the newly minted “coin” is entirely based upon the promises of a white paper and the estimated capability of the project’s team to deliver in fine the said promises.

And of course, the ICO market, at least initially, was completely unregulated.

And these very characteristics have been, for Instaforex - Mayzus & Co, synonymous to untold riches.

 

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Up to the “ICO boom”, their “business” was somewhat limited by real-life factors.

After all, the traders they were robbing blind since years were still betting upon financial assets which had a verifiable behaviour, driven by market forces.

When the EUR/USD pair is up on the global markets, it is hard to steal money from the traders by explaining them it was in fact down. Hence the bonuses, the crazy leverage and the “antifraud department” interventions, but there is only so much you can make out of this, right ?

Of course, the binary options were a considerable improvement, and our little circle of colluding people have been making a killing out of it, both directly and indirectly (more on this later), achieving to turn the retail forex business into a complete casino.

But, on that one, the regulators have been quite fast to answer, and the whole thing, while still lucrative, soon began to require as much efforts as “traditional” kitchen forex to sell.

But this ICO thing, well, it was something else altogether.

 

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To make a parallel, it was as much an improvement to Instaforex - Mayzus & Co as the Steve Madden IPO was to the Wolf of Wall Street.

For our “Wolves of Kaliningrad”, it was a real bonanza.

They finally had access to financial assets that they could generate themselves, on demand, and peddle to the public. Moreover, the US market was open, again (though they had not really ever abandoned it, but more on this later) as these financial assets were, at least initially, unregulated.

Not only the Initial Coin Offering was proving a tremendous source of revenue, as the suckers investors were gathering in masses, and coming back for more, but the whole process itself was greatly facilitating money laundering on a large scale (more on this later), as the market developed, over a couple of months, into a multi-billion dollars market.

In a market which is based entirely upon a relatively new technology only a few understand, with no way for the average investor to determine the quality of an asset due to the use of technical mumbo-jumbo in the white papers and the fact that team members, experts and major players in the market have literally emerged overnight out of thin air, who was best positioned to take advantage of the situation ? Our “Wolves of Kaliningrad”.

Of course, they had the support of other well known Wolves, but more on that later.

The formidable marketing machine of Instaforex - Mayzus & Co, which had been perfected over the years, was ready to hit the market with full force, and it was not long until hundreds of ranking, comparison or listing sites would peddle to the unsuspecting investors thousands of “altcoins” (alternative coins to the well established bitcoin).

And, before investors could even realize what was happening to them, their “altcoins” turned into “shitcoins” as soon as they had been “introduced on the market” (i.e sold to enough fools willing to part from their money), to a point where it is estimated that over 80% of the ICOs have been pure scam (more on this later).