By cryptoadmin In New York, the founder of Believe is facing serious legal trouble over an alleged rug-pulling scheme, while federal authorities are opening a compensation process for victims of the OneCoin scam.
The Southern District of New York is reviewing both cases, but it is currently unknown if victims in the Pasternak case will receive compensation.
Believe founder facing charges over alleged rug pull
The founder of the Solana-based platform Believe, Ben Pasternak, a 26-year-old Australian entrepreneur who was once on Forbes’ 30 Under 30 list for his plant-based chicken company, is now facing an indictment in a New York court for an alleged “rug pull.”
A rug pull is a popular crypto scam that occurs when developers hype a new token to attract investors, inflate its price, and then suddenly pull the metaphorical rug out from under users’ feet, abandoning the project or draining funds, leaving investors with worthless cryptocurrency.
Prosecutors and civil lawsuits allege that Pasternak’s platform, Believe, previously called Clout, engaged in a deceptive cycle of rug pulling.
Pasternak launched a token called $PASTERNAK, which was later rebranded as $LAUNCHCOIN, with heavy promotion. The token’s value spiked rapidly, attracting retail investors only to suffer a “catastrophic decline.”
Investors were allegedly told to hold onto their losing tokens and then told to migrate to a new token called $BELIEVE.
The civil complaint claims that the platform processed over $6 billion in trades and extracted roughly $54 million in fees while investors suffered massive losses. The case is currently under review in the Southern District of New York (SDNY).
Cryptopolitan has covered the district’s prosecutors’ mean streak in aggressively pursuing convictions in crypto-related cases, including the extensively chronicled Tornado Cash trial.
DOJ’s compensation program for OneCoin fraud victims
While many crypto investigations end with criminals being convicted, the victims are often left empty-handed. However, in a recent case, the Department of Justice (DOJ) confirmed that more than $40 million in forfeited assets are now available for victim compensation.
Through the Asset Forfeiture Program, the DOJ has returned more than $12.5 billion to victims. The program is led by the Criminal Division’s Money Laundering, Narcotics, and Forfeiture Section (MNF).
The money was recovered from the creators of OneCoin, a fraudulent cryptocurrency marketed as a “Bitcoin killer” that operated out of Sofia, Bulgaria, between 2014 and 2019. The scheme defrauded an estimated 3.5 million people out of over $4 billion.
Victims who purchased the fraudulent OneCoin cryptocurrency during the scheme’s active years may be eligible for a refund. However, the deadline to file a petition for compensation is June 30, 2026.
The case against OneCoin remains active in the Southern District of New York (SDNY), which is a federal court known for its aggressive pursuit of financial fraud. The company’s co-founder, Karl Sebastian Greenwood, was sentenced to 20 years in prison, while the other co-founder, Ruja Ignatova, known as the Cryptoqueen, remains on the FBI’s Top Ten Most Wanted list.