Shabtay Yaacoby Receives Record 14-Year Prison Sentence for $50 Million Money Laundering Scheme

A 56-year-old Israeli man has been sentenced to 14 years in prison for laundering more than $50 million of scam funds. Shabtay Yaacoby, who was found guilty of money laundering after a 13-week jury trial, was sentenced in the NSW District Court today.

The sentence is the longest ever for a money laundering offence in Australia. Yaacoby will be eligible for parole in January 2035.

According to the court, Yaacoby played a "leading role" in a criminal enterprise. He was a director and shareholder of licensed digital currency exchange Blue Star Exchange, which purportedly allowed customers to buy and sell cryptocurrencies.

One New South Wales man testified that he was scammed out of about $4 million from the superannuation fund he shared with his wife. He had sent the money to Blue Star Exchange, believing he was putting it into a high-interest term deposit. The man was one of 39 victims who testified at the trial.

"His offending was not isolated" and was "persistent", the judge said. While Yaacoby was not involved in the scamming itself, he was knowingly working with the fraudsters to move the stolen money out of Australia.

Yaacoby was arrested while visiting Sydney in 2023. The court heard he was in Australia to attempt to unfreeze multiple bank accounts related to his business.

The court also heard that Yaacoby had played a "heroic" role during the Bondi massacre, while on bail awaiting his trial. Yaacoby reported to a psychologist that he used his body to shield the 10-year-old child of a Rabbi during the terror attack, having lost sight of his wife in the chaos.

Justice Averre found that Yaacoby's mental health was not a factor in the seriousness of the offending, as it did not affect his ability to plan or understand his crimes, and noted that there had been no reparation offers made to the victims by the offender. In his sentencing, Justice Averre instituted a reparations order for the victims.