Latest news with #EscobarInc
Phone Arena
6 days ago
- Business
- Phone Arena
The gold-plated Escobar phone scam has finally caught up with its creator
If the words Escobar foldable phone ring a bell, congrats – you've definitely been paying attention to tech news over the years. That gold-plated foldable phone from 2019 was very much a real headline at one point – even if the product itself turned out to be anything but. Now, the guy who ran the show – Swedish CEO Olof Kyros Gustafsson – has officially pleaded guilty to fraud and money laundering. The announcement comes straight from the US Department of Justice, marking the end of one of the most bizarre tech scams in recent memory. Back in 2019, Gustafsson was fronting Escobar Inc., a company named after the Colombian drug kingpin. The company promised wild things: gold-plated foldables for just $399, physical cryptocurrency called 'Escobar Cash,' even flamethrowers. But instead of building real products, Gustafsson was just slapping gold foil on Samsung's $2,000 Galaxy Fold and reselling it under the Escobar name. Something that popular reviewer Marques Brownlee (MKBHD) exposed back then in a video, helping spread the word about the whole scam. Video credit – MKBHD However, people placed orders, and well…they never got the phone. Instead, Gustafsson would send them some random 'Certificate of Ownership,' a promo book, or other junk just to have a tracking number. If someone asked for a refund, the company would point to that mailing receipt to deny the request. In total, Gustafsson now faces up to 30 years in prison – 20 for the fraud, 10 more for the laundering – and could be ordered to pay $1.3 million in restitution. Sentencing is scheduled for December 5. This whole saga is a wild cautionary tale about too-good-to-be-true tech. I mean, a foldable phone for $400, especially one dipped in gold? That's not a bargain, it's bait. So, better stick to official stores or trusted retailers – and if something sounds too good to be true, it almost always is.
Time of India
6 days ago
- Business
- Time of India
The Escobar Fold phones were a scam after all
Remember those unbelievably cheap foldable phones branded with Pablo Escobar 's name? Turns out they were exactly what they looked like, too good to be true and a scam. Olof Kyros Gustafsson , the 32-year-old Swedish mastermind behind Escobar Inc. , pleaded guilty to fraud and money laundering charges, finally putting an end to one of tech's most brazen scams. Gustafsson convinced thousands of people to shell out $399 for the " Escobar Fold 2 ," promising cutting-edge foldable technology at a fraction of Samsung's $2,000 Galaxy Fold price. The catch? Most never received their phones. Those lucky few (mostly influencers) who did get a package found Samsung Galaxy Folds wrapped in cheap gold foil, Escobar Fold phones were not made by Escobar Inc. The Escobar Inc caught attention when Marques Brownlee famously unboxed an Escobar Fold 2 on YouTube, revealing it was simply a Samsung Galaxy Fold with gold foil stickers slapped on top. by Taboola by Taboola Sponsored Links Sponsored Links Promoted Links Promoted Links You May Like Why seniors are rushing to get this Internet box – here's why! Techno Mag Learn More Undo Even more telling, Gustafsson later admitted in company correspondence that the Fold 2 was "an overstock purchase of the Samsung Galaxy Fold" bought from retailers and wholesalers. The first device, the Fold 1, bore striking similarities to the FlexPai from Chinese manufacturer Royole, though Gustafsson denied any connection. Now, that Fold 2, per Marques, was sent by Escobar Inc. themselves. That tells that Gustafsson deliberately sent sample devices to influencers to drum up interest, knowing the buzz would drive more orders. It worked, The videos inadvertently gave the fake company some credibility, eventually pocketing over $300,000 from unsuspecting customers. Books instead of Folds These thousands of people who paid around $399, would get a "Certificate of Ownership," over their mail. After that one would hope for their Escobar Fold phone. Instead they received Pablo Escobar's brother Roberto's autobiography and a congratulatory flyer featuring scantily-clad women. When buyers demanded refunds, Gustafsson used these book shipments as "proof" that products had been delivered, successfully blocking refund requests through payment processors. The company didn't stop at phones. Gustafsson also hawked "Escobar Flamethrower," a dupe of Elon Musk's Boring Company flamethrower, an "Escobar Gold 11 Pro Phone" that was supposedly a refurbished iPhone, and even "Escobar Cash," that the Escobar Inc. marketed as the world's first physical cryptocurrency. None of these products existed beyond promotional materials and the occasional sample sent to reviewers. CEO faces 20 years jailtime for $1.3M fraud Federal investigators eventually caught up with Gustafsson's operation. He was arrested at his home in Marbella, Spain, in December 2023 during a joint raid by Spanish police and U.S. Internal Revenue Service agents. After unsuccessfully seeking asylum in Spain to avoid extradition, he was brought to Los Angeles to face charges for 115-count federal indictment Court documents show Gustafsson laundered over $307,000 through bank accounts in the United States, Sweden, and the United Arab Emirates during just the first six months of the scheme. Gustafsson sentencing is scheduled for December 5, and he faces faces up to 20 years in federal prison on fraud charges and up to 10 years for money laundering when he's sentenced on December 5th. He must also pay $1.3 million in restitution to the customers he duped, though many victims are likely wondering if they'll ever see that money either. AI Masterclass for Students. Upskill Young Ones Today!– Join Now
The Verge
7 days ago
- Business
- The Verge
The Escobar Phone scam saga has finally come to an end
is a news editor covering technology, gaming, and more. He joined The Verge in 2019 after nearly two years at Techmeme. The former CEO of the company that marketed the sketchy-looking Escobar Fold 1 and Escobar Fold 2 phones — which you may remember from a 2020 video from Marques Brownlee — has pleaded guilty to fraud and money laundering, according to the US Department of Justice. In a plea agreement, United States attorneys detail how Olof Kyros Gustafsson and Escobar, Inc. took orders for the phones and other products branded with the likeness of the drug lord Pablo Escobar, seeded products with tech reviewers and social media influencers to 'in order to attempt to increase demand,' did not deliver the products to customers, and transferred and laundered customer money to 'use the funds for their own personal use.' In Brownlee's video, he unboxed an Escobar Fold 2 phone shipped to him and found that it was just a Samsung Galaxy Fold — a phone that cost nearly $2,000, far more than the $400 Escobar Inc. was selling it for — with a gold sticker on it. Escobar Inc. also sold a $500 'Escobar Flamethrower' that was 'modeled after' The Boring Company's Not-A-Flamethrower, the $500 'Escobar Gold 11 Pro Phone' that was 'marketed as a refurbished Apple iPhone 11 Pro,' and Escobar Cash that was 'marketed as the world's first 'physical cryptocurrency,'' according to the plea agreement. Instead of sending products to paying customers, Gustafsson mailed them a ''Certificate of Ownership,' a book, or other Escobar Inc. promotional materials' to create a mailing record, the DOJ says in its press release. Then, when a customer tried to get a refund for something that wasn't delivered, 'Gustafsson fraudulently referred the payment processor to the proof of mailing for the Certificate of Ownership or other material as proof that the product itself was shipped and that the customer had received it so the refund requests would be denied.' A judge has scheduled a sentencing hearing for December 5th, where Gustafsson faces up to 20 years in federal prison for the fraud-related counts and up to 10 for the money laundering-related counts. Gustafsson must also pay as much as $1.3 million in restitution.
Android Authority
7 days ago
- Business
- Android Authority
Escobar Fold scam finally catches up with its creator, who now faces years in jail
TL;DR Escobar Fold phone creator Olof Gustafsson has pleaded guilty to multiple counts of fraud and money laundering. Customers were sent certificates or merch instead of the foldables, flamethrowers, or gold iPhones they paid for, making refunds harder to claim. Gustafsson could face many years in prison and will pay up to $1.3 million in restitution. It looked like an obvious scam at the time, and of course it was. The man behind the gold-plated Escobar Fold phones and other eyebrow-raising tech has pleaded guilty to multiple fraud charges before a federal judge in Los Angeles, and faces serious prison time. As reported by TechSpot, Olof Gustafsson, the Swedish CEO of Escobar Inc., pleaded guilty to six counts of fraud and money laundering, including wire fraud, mail fraud, and conspiracy to commit both. He now faces up to 20 years in federal prison for each fraud charge, and up to 10 years for each laundering count, with sentencing set for December 5. Escobar Inc. was founded by Roberto Escobar, brother of the infamous drug kingpin. The tech-minded of the siblings claimed to own the intellectual property rights to the Escobar name, which now has a new spate of criminality associated with it. Escobar Inc. made headlines in 2019 and 2020 with a series of wild product launches, including the foldable Escobar phones, flamethrowers, and even 'Escobar cash,' which was pitched as the world's first physical cryptocurrency, whatever that means. When the Escobar Fold 2 launched, it was revealed that it was a Samsung Galaxy Fold covered in gold stickers and priced at just $399 — less than a quarter of the Fold's actual value. Its predecessor, the $349 Escobar Fold 1, was a rebranded Royole FlexPai. The build of the phones ended up being fairly irrelevant, as most of the company's customers never received the products they paid for anyway. Instead, they got a certificate of ownership, a book, or some other Escobar-branded merchandise. This was just enough to create a shipping record which Gustafsson then used to convince payment processors like PayPal and Klarna that a product had been delivered, making refunds much harder to claim. The same scheme was used for other fake products, including a $249 flamethrower modeled after Elon Musk's 'Not-a-Flamethrower' from The Boring Company, as well as gold-plated iPhones. Gustafsson admitted to sending crudely assembled samples to tech influencers and reviewers in an attempt to spark demand, with MKBHD's viral video in 2020 unintentionally helping the scam gain traction. Gustafsson alone was wired over $300,000 from victims during the operation, before being arrested in Spain in 2022 and extradited to the US in March this year. As part of his plea deal, he agreed to pay up to $1.3 million in restitution and forfeit any proceeds from the fraud, including money in a Swedish bank account. 'I want the people to be able to burn money, like me and Pablo used to do,' Roberto Escobar said in a 2019 press release for the flamethrower. Most of his customers lost their money long before they had the chance to torch it, but they'll still hope to receive some sort of refund based on this plea deal. Got a tip? Talk to us! Email our staff at Email our staff at news@ . You can stay anonymous or get credit for the info, it's your choice.
Yahoo
29-03-2025
- Yahoo
He sold Pablo Escobar-branded flamethrowers, phones and more. But it was all a scam, authorities say
A Swedish man known as "El Silencio" has been accused of running a global scam in which he sold Pablo Escobar-branded products — including cellphones, flamethrowers and cash — but never delivered them because they didn't exist, authorities say. Olaf Kyros Gustafsson, 31, was extradited from Spain to Los Angeles, where he was arraigned Friday on a 115-count federal indictment alleging money laundering, wire fraud and mail fraud, according to the U.S. Department of Justice. He has pleaded not guilty. Gustafsson is accused of running a business called Escobar Inc., a Puerto Rico-registered corporation that held rights to the persona and legacy of the late Colombian drug lord Pablo Escobar. Read more: Pablo Escobar's legacy is an 'open wound' in Medellín. But tourists can't get enough of it Escobor was the leader of the Medellín Cartel, which became one of the most powerful and violent drug trafficking organizations in history during the 1980s. Gustafsson used these rights to market a wide range of Escobar-branded products from 2019 to 2023, often copying and undercutting the prices of other similar goods sold online, prosecutors allege. He advertised an Escobar Flamethrower, an Escobar Fold Phone, an Escobar Gold 11 Pro Phone and Escobar Cash that he touted as a "physical cryptocurrency." None of these products actually existed, prosecutors allege. To attract customer interest in the nonexistent Escobar Inc. products, he allegedly sent Samsung Galaxy Fold phones wrapped in gold foil to online technology reviewers. The goal was to entice customers to order the product after reading a review. Read more: Colombia Drug Lord Escobar Dies in Shootout Gustafsson accepted payment using processors such as PayPal, Stripe and Coinbase. But instead of sending customers the product they purchased, prosecutors allege he would instead mail a "Certificate of Ownership," a book or other Escobar Inc. promotional materials. He later referred payment processors to this mailing history to fend off requests for refunds from upset customers around the world, prosecutors said. Some of the people who prosecutors say fell victim to the scam reside in Los Angeles, Gardena and Commerce. Read more: Escobar's hippos are flourishing in Colombia, and some should be killed, scientists say Gustafsson is accused of using bank accounts in the United States, Sweden and the United Arab Emirates to conceal and disguise his activities. He was arrested in Marbella in December 2023 when Spanish police and U.S. Internal Revenue Service agents raided his home on the Spanish Costa del Sol, according to reporting from the Swedish newspaper Aftonbladet. He then sought to evade extradition by seeking asylum in Spain, but that effort was unsuccessful, the paper reported. In an interview with the Swedish paper, he criticized his home country for failing to protect him from extradition. Read more: Simple Tale of How U.S. Helped Bring Down a Drug King Gustafsson has been indicted on 41 counts of money laundering, 35 counts of international money laundering, 25 counts of engaging in monetary transactions in property derived from specified unlawful activity, nine counts of wire fraud, three counts of mail fraud, one count of conspiracy to commit wire fraud and mail fraud, and one count of conspiracy to engage in money laundering, according to the Justice Department. He remains in federal custody and is scheduled to go to trial on May 20. Sign up for Essential California for news, features and recommendations from the L.A. Times and beyond in your inbox six days a week. This story originally appeared in Los Angeles Times.
