This year, Aussie crypto pioneer Sam Karagiozis revealed he had lost around $3 million following bitcoin’s price crash.
But last week, the 27-year-old’s fortunes fell further still after he was arrested on a string of serious drug charges.
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An Australian Federal Police (AFP) spokeswoman confirmed to news.com.au Mr Karagiozis’ March 7 arrest, which was made as the result of an investigation into an organised crime syndicate.
The high-profile businessman was charged with importing, trafficking and possessing approximately 30 kilograms of drugs, including MDMA, cocaine, methamphetamine and ketamine.
Steroids, cash and other items related to cryptocurrency were also seized by authorities.
Police believe Mr Karagiozis played a “key role” in directing the operations of the syndicate, which allegedly used various dark net sites, bitcoin accounts and legitimate business for the sourcing, payment and distribution of the illicit drugs.
The shock arrest was made after a joint AFP and Australian Transaction Reports and Analysis Centre (AUSTRAC) taskforce raided a number of properties in Victoria.
AUSTRAC has also suspended two crypto exchange businesses linked to Mr Karagiozis, including Auscoin.
The AFP has also frozen $2 million worth of assets, such as bank accounts, properties, vehicles, cash and crypto.
“AUSTRAC’s role is to deter and disrupt criminal exploitation of Australia’s financial system, and we take swift action where we there is a reasonable risk of compromise. Our decision to suspend the registration of the two businesses means they can no longer lawfully operate,” AUSTRAC national manager, regulatory operations, Dr Nathan Newman said in a statement.
“When you take the profit out of crime, you hit offenders where it hurts most. Combined with serious criminal charges attracting long prison sentences, this highlights how trafficking drugs is simply not worth it in the long run,” AFP Detective Superintendent Paul Hopkins said.
The situation Mr Karagiozis now finds himself in is a far cry from the lavish life the multi-millionaire, who has a number of sprawling properties and luxury vehicles to his name, is used to.
In an interview with news.com.au in January, Mr Karagiozis — whose knuckles famously bear the tattooed words “self made” — was still spruiking crypto despite its value dropping to less than $5000, down from its peak of $27,000.
That drop represented a $3 million loss for Mr Karagiozis, who invested $15 million to roll out the first nationwide network of bitcoin ATMs several years ago through his company, Auscoin.
“Let’s be real, it would be a lot nicer if it hadn’t dropped in value — I’m not going to sit here and say it doesn’t bother me — but at the end of the day, I believe in the long term … I only ever put in what I could afford to lose,” he said at the time.
“I’m definitely confident bitcoin will get back to where it once peaked, and it will more than likely pass that again — however, I don’t think that will happen within a six-month period.”
The colourful “serial entrepreneur” — who dropped out of school at 15 and flipped burgers at McDonald’s before becoming a property investor, restaurant owner and businessman — was also one of Australia’s earlier cryptocurrency investors, snapping it up for a steal and sitting back as its value soared.
At one stage, he even sold bitcoin to Australian tennis bad boy Nick Kyrgios.
Last February, Mr Karagiozis also made headlines after a 60 Minutes report suggested Auscoin was a “money grab” built on little more than “grandiose promises” — accusations strongly denied by the crypto boss.
“Calling it a blatant scam with zero evidence is detrimental … Auscoin is the backbone of my life and reputation right now,” he told news.com.au at the time.
“This is what I do, whatever advice I give people, their success is my success.”
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