Six years ago, the Escobar Fold 1 and Fold 2 were launched as the most affordable foldable phones on the market. The Fold 2 review unit given to MKBHD was actually just a Samsung Galaxy Z Fold with cheap stickers on it. The Fold 1, meanwhile, was just a Royole FlexPai. This week, Escobar Phone CEO Olof Gustafsson pleaded guilty to a fraud and money laundering scheme involving the phones he sold.
Olof Gustafsson listed the Escobar Fold 1 and Escobar Fold 2 for around $400, but after buyers paid, the devices never arrived. Instead, buyers received certificates, Escobar-branded merchandise, and worthless Escobar Cash crypto tokens. This was to allow for payment to be received even though it wasn’t the same as what the customer ordered.
Gustafsson’s fraud caught the attention of the US Department of Justice until he was arrested in Spain in 2022. Earlier this year, he was extradited to the US to stand trial. Two days ago, Gustafsson pleaded guilty to all charges in court. The sentence will be handed down on December 6, with him facing up to 30 years in prison.