Search Articles
LOS ANGELES (CN) — A Swedish man who marketed Pablo Escobar-branded merchandise, including flamethrowers and mobile phones, pleaded guilty Friday to multiple counts of fraud and money laundering.
Olof Gustafsson, 32, a.k.a. “El Silencio," entered a plea for one count of conspiracy to commit wire fraud and mail fraud, one count of wire fraud, one count of mail fraud, one count of conspiracy to commit money laundering, one count of concealment money laundering, and one count of international concealment money laundering, before a federal judge in Los Angeles.
The former CEO of Escobar Inc. was arrested in Spain two years ago and extradited to the U.S. in March.
In his plea agreement, Gustafsson admits that in 2019 he advertised and marketed an Escobar-branded knockoff of the “Not a Flamethrower” that had been sold by Elon Musk’s The Boring Company the previous year. While the limited edition Boring Co.’s flamethrower was sold for $500, the Escobar version was advertised for just $249.
The only caveat was that customers who paid online for one of the Escobar flamethrowers never received one.
Instead Gustafsson would mail them a certificate of ownership, a book, or other Escobar Inc. promotional materials so there was a record of mailing from the company to the customer.
When customers tried to get a refund, Gustafsson referred the payment processors, such as PayPal and Klarna, to the proof of mailing for the certificate of ownership or other material as proof that a product was shipped and that the customer had received it.
As a result, the vast majority of the hundreds of people who paid for a non-existent Escobar flamethrower never got their money back.
Escobar Inc. is a company started by the late drug kingpin’s brother Roberto Escobar. The company owns the intellectual property rights related to Pablo Escobar.
“I want the people to be able to burn money, like me and Pablo used to do,” Roberto Escobar said in a July 2019 press release announcing the Escobar flamethrower. “I burned probably a couple of billion dollars over the years.”
In addition to the flamethrowers, Gustafsson also marketed, but never delivered, Escobar-branded mobile phones, including refurbished, gold-plated Apple iPhones that cost $500. He also sold Escobar cash, which was advertised as the world’s first “physical cryptocurrency.”
As part of the fraud scheme, he and his co-conspirators would send crudely-made samples of purported Escobar Inc. products to online technology reviewers and social media influencers in order to stimulate demand.
As part of his plea agreement, Gustafsson agreed to pay up to $1.3 million in restitution to victims, the U.S. attorney’s office in Los Angeles said, and to forfeit funds that were proceeds of his fraud schemes, including money currently held in a bank account in Sweden.
Gustaffson is scheduled to be sentenced Dec. 5. He faces a potential 20 years in federal prison for each fraud count and up to 10 years for each money laundering count.
Gustafsson’s attorney didn’t immediately respond to a request for comment.
Follow @edpetterssonSubscribe to our free newsletters
Our weekly newsletter Closing Arguments offers the latest about ongoing trials, major litigation and rulings in courthouses around the U.S. and the world, while the monthly Under the Lights dishes the legal dirt from Hollywood, sports, Big Tech and the arts.