Escobar phone scam: Former CEO pleads guilty to fraud

The infamous Escobar phone scam has finally reached its conclusion, with former Escobar Inc. CEO Olof Kyros Gustafsson pleading guilty to federal charges of fraud and money laundering. The scheme, which made headlines after tech reviewer Marques Brownlee exposed the Escobar Fold 2 as a Samsung Galaxy Fold with a gold sticker, deceived thousands of customers. Shoppers believed they were purchasing luxury tech products for a fraction of the price, but instead received nothing or worthless promotional materials. The Department of Justice has confirmed Gustafsson’s admission to misusing customer funds and manipulating shipping records to deny refund claims.

How the Escobar phone scam unfolded

The scam revolved around products marketed under the notorious Escobar brand, including the Escobar Fold 1 and Fold 2 phones, a so-called Escobar Flamethrower, and even a fake physical cryptocurrency called Escobar Cash. Gustafsson and his company took advantage of high-profile tech reviewers and influencers to generate buzz, but the operation had no intention of fulfilling the majority of orders. Instead, customers were mailed certificates, books, or promotional flyers simply to generate proof of mailing. These tactics were then used to trick payment processors and prevent refund claims, extending the reach and damage of the scam.

Influencer marketing and deception in the Escobar phone scam

One of the more disturbing aspects of the Escobar phone scam was its reliance on influencer trust. Popular tech YouTuber Marques Brownlee revealed that the Escobar Fold 2 was nothing more than a rebranded Samsung device. Despite this revelation, the company continued to ship to influencers while withholding products from paying customers. By appearing legitimate through influencer videos and social media hype, the scam baited unsuspecting buyers into parting with their money. The use of fake luxury branding and manipulated pricing played a key role in attracting victims worldwide.

Legal consequences and the end of Escobar Inc.’s deception

Gustafsson’s guilty plea marks a significant step toward justice for victims of the Escobar phone scam. He faces up to 20 years in prison for fraud and 10 years for money laundering, with potential restitution payments totaling $1.3 million. His sentencing, scheduled for December 5th, could serve as a powerful warning to future digital scammers exploiting trust through fake tech products and influencer-driven marketing. While Escobar Inc. may no longer be active, its case highlights the importance of consumer vigilance in an age of viral promotions and too-good-to-be-true tech deals.