CHAPTER 11
WALTENHOFEN GUSSWERKS
Waltenhofen, Southern Germany, 2009
Carlos Gil was worried. Thirty plus years as a tough union guy, a real “Schwabe” (which is to say too organized, too German), he knew when a factory was struggling. Waltenhofen Gusswerks was definitely in trouble, and his priority was to save the workers. All 140 of them if he could. It had been floundering for months in administration and had already lost 60 good men, but it had a solid reputation in Bavaria, where it was known for making high-quality casts for machinery.
Securing a buyer was the easy part. Less simple was making sure any deal was good for the workers. Union reps in Germany are powerful enough to nix a deal, and Carlos had done it before. He wouldn’t agree to any buyer who didn’t care about his guys—full stop. Every saved job meant a lot to him, but the Gusswerks were special. Many of the workers there came from generations of men who had worked in the same factory doing the same hot and heavy work at the blast furnace.
By the time the well-dressed Ruja Ignatova walked into his office in early 2010, Carlos was starting to doubt whether he’d ever find the right person. He’d already said no to three potential buyers because they wanted to slash wages. Almost immediately Carlos knew he’d hit gold. Ruja was business-like, cool and professional. She had spreadsheets, projections and an impeccable CV. If anything, she was too qualified. But the best part was that Ruja was proposing to buy the factory jointly with her father, Plamen, who had worked in steel foundries in Bulgaria for years. A business consultant and a steel worker, brains and brawn, was the perfect combination. All that was missing was a pretty bow on top.
“Listen,” said Carlos firmly. “We have only eighty of the one hundred and forty workers left. We have to raise their wages—and get the sixty lost workers back.” He wasn’t prepared to negotiate on this.
“No problem,” Ruja replied with a nod. “We won’t dismantle the unions and we’ll try to re-employ as many of the lost workers as we can.”
That was all Carlos needed. She offered €2.2 million for the factory and secured a loan with a German bank. (Unusually, as collateral on the loan, Ruja and Plamen used two blast furnaces that they owned in Bulgaria, worth almost €1 million, which they agreed to transport over and install in the factory.) Carlos wasn’t interested in the small print—that was for the bankers and the business people to worry about. He was just happy that he’d saved more jobs.
In spring 2010, almost five years before OneCoin mined its first coin, Ruja and her father became co-owners of a steel metal works in Southern Germany.
For the first few months, everything was fine. Production ticked along and the workers were paid on time. Ruja sat each day in her on-site corner office, and her mother, Veska, served as her assistant. Plamen was usually found on the factory floor, overseeing production and talking shop with the workers. The only member of the Ignatov clan not around was Konstantin, who was studying journalism and politics at Tübingen University, and busy playing bass guitar in a metal band. Carlos forgot about the Gusswerks. He had other workers in other factories to represent. That’s how it went with Carlos—he only got involved in a factory when things were going wrong.
One morning, about a year after Ruja bought the factory, an unhappy employee phoned him.
“Carlos! Miss Ignatova has a consulting company, which she owns, called RilaCap. And she has hired her own company, and she’s paying herself out of the factory money.”1
“To do what?” asked Carlos. It was the first he’d heard of it.
“I’m not sure,” the employee replied. No one in the factory knew anything.
When Carlos spoke to Ruja, she told him it was just some minor rebranding work—nothing to worry about and the workers were still getting paid. But, slowly, the working conditions started to deteriorate. Staff were asked to work extra hours unpaid. Invoices were ignored. Holiday money was reduced. The mood wasn’t helped when Ruja turned up for work one day saying her company car—a Porsche Cayenne—had been stolen during a recent trip to Bulgaria. Something was clearly wrong.
The blast furnaces that Ruja and Plamen had promised to bring across from Bulgaria hadn’t turned up either. The factory was struggling with out-of-date equipment and the new furnaces were desperately needed to keep output up. But weeks of waiting turned to months and there was always some new excuse as to why it would be next week, next month.
“We need the blast furnaces now,” Carlos said, over and over.
“Why are you getting involved?” Ruja replied coolly. Ruja hardly ever lost her temper—it was bad for business. “I am paying the workers’ wages—so what’s the problem?”
Carlos—who by this point doubted whether these furnaces even existed at all—started turning up at the factory unannounced demanding to see her, but Ruja would simply walk out of the room as if she were too important to be dealing with a union boss. No one had ever treated him like this before.
One morning, Carlos had a phone call from one of the workers.
“Carlos, Ruja has sold the factory,” he said, panicking.
“What? What do you mean sold the factory?!”
“Ruja has sold the factory to a man for one Euro,” he replied. The workers had all come to work as normal that morning, only to find the place had been abandoned. Pandemonium was breaking loose. No one knew what to do.
“Where is she?” asked Carlos.
“She’s gone.”
Carlos dropped everything and rushed down to the factory. It was like a movie scene. The place had clearly been abandoned in a rush: there were missing papers, burnt documents, broken laptops. Carlos called and called, but Ruja didn’t answer her phone. He drove to her home, but no one was there. And when he started investigating the paperwork, Carlos was staggered to find out it was true: Ruja had sold the Waltenhofen Gusswerks to a German businessman for a grand total of one Euro. For 30 years Carlos had dealt with his fair share of slippery bosses and money grubs but he’d never seen anything like this. The factory was dead—that much was obvious. There would be no new buyers. Within weeks Waltenhofen Gusswerks was shuttered for good, along with the livelihood of 140 workers.
For years afterward, Carlos thought about the strange businesswoman who’d bankrupted one of the factories he represented. Some days, he imagined that Ruja had started with good intentions, but things spiralled out of control. Other days, he was convinced she planned it all along. And the workers! He still found it difficult to talk about them. He bumped into some of them on the streets every once in a while; most of them were still unemployed.
One day in 2015, someone from the local paper sent him an article via Facebook. “Carlos,” he wrote. “Have you seen this?”
For a moment his heart almost stopped. It was her. The same confidence, the same clothes, the same red lipstick. But Ruja Ignatova wasn’t a disgraced executive who’d bankrupted a business, destroyed 140 lives and vanished: she was a celebrity, a business guru, a “Cryptoqueen.”
“How is it possible?” he said to himself. “How could anyone trust this woman?” Didn’t they know what she’d done? He wondered if she might disappear again—just like she had done in Waltenhofen.
On Tuesday April 12, 2016, Ruja stood in the dock at Augsburg District Court, a small town about 70 kilometers from the Gusswerks. Her authorized defense attorney was Martin Breidenbach, her increasingly trusted lawyer who’d worked previously with Sebastian and also helped her set up the OneCoin companies. She showed no emotion as she pleaded guilty to intentional breach of duty in the event of insolvency, to fraud, to withholding and embezzlement of employee’s wages and to violation of accounting duties.2
After seeing the Facebook article, Carlos’s union had hounded Ruja and her father, Plamen, and pressed charges. His union calculated that she’d made off with roughly a million Euros—including €120,000 from suppliers who never received their orders. Prison time would have been a disaster for Ruja. Not only would it annihilate her credibility, she had a major corporate event coming up in London in two months. The judge gave her a 14-month suspended sentence and an €18,000 fine. Plamen, who wasn’t present, had to pay €12,000. Carlos thought it was a light punishment for having destroyed the lives of so many people, but the judge concluded that Ruja was a “smart young woman” who had a “socially positive future.”
She slipped out of the courtroom and returned to Bulgaria as if nothing had happened. Less than two weeks later, Ruja (wearing her trademark red lipstick, professional make-up and a black and red lace dinner dress, although it was only early afternoon) cut the red ribbon for the brand-new OneCoin headquarters at 6A Petko R. Slaveykov Square, Sofia. Confused commuters wandered past as Ruja gave an impromptu speech in front of dozens of excited staff. The grand-fronted six-story building, which overlooked the tramline that ran through the tree-lined pedestrian street, was a sign of the company’s growing stature: a large portrait of Ruja hung in the main meeting room, and Ruja built a “Crypto Centre” next to the reception, which was a shrine to her vision. It had a gold and black counter and a large acrostics on the main wall, which spelled OneCoin: grOwth, sustaiNability, SafEty, BloCkchain, lOyalty, stabIlity, ceNtralised. She had a life-sized cardboard cut-out of herself installed, which admiring fans would touch on entry. (In later months, promoters who were in her graces would be greeted at the Crypto Centre and taken up to Ruja’s fourth-floor office; while those out of favor would be left in the Crypto Centre for hours, and sometimes sent home without seeing anyone.) Visitors to the Crypto Centre could buy merchandise, pens, hoodies and learn all about Ruja’s achievements. Waltenhofen wasn’t mentioned anywhere.