In late 2019, as Samsung introduced its Galaxy Fold, a lesser-known company, Escobar Inc., unveiled a gold-plated foldable phone at a fraction of the cost. Founded by Roberto Escobar, brother of the infamous drug lord Pablo Escobar, and led by Swedish CEO Olof Gustafsson, the company promised luxury devices at unbeatable prices. However, these promises were part of an elaborate scam that has now led to Gustafsson’s guilty plea on multiple counts of fraud and money laundering.
The Rise of Escobar Inc.
Escobar Inc. entered the tech scene with bold claims and aggressive marketing. Their first product, the Escobar Fold 1, was a rebranded Royole Flexpai priced at $350. This was followed by the Escobar Fold 2, a $400 device that was essentially a Samsung Galaxy Fold covered in gold stickers. The company also advertised other products, including a $250 flamethrower mimicking Elon Musk’s Boring Company design, gold-plated iPhones, and even Escobar Cash, touted as the world’s first physical cryptocurrency.
The Scam Unveiled
Despite the flashy marketing and enticing price points, the products were largely nonexistent. Customers who placed orders received promotional items or fake certificates of ownership instead of the promised devices. This tactic created shipping records, allowing Escobar Inc. to dispute refund requests by presenting proof of delivery. The few actual products that did exist were sent to tech influencers to generate buzz and lend credibility to the scam.
Tech reviewer Marques Brownlee, known as MKBHD, received an Escobar Fold 2 and exposed it as a Samsung Galaxy Fold with a gold sticker. His 2020 video brought significant attention to the scheme, highlighting the deceptive practices of Escobar Inc.
Legal Consequences
The fraudulent activities of Escobar Inc. did not go unnoticed by authorities. Gustafsson was arrested in Spain in 2022 and extradited to the United States in March 2025. He has since pleaded guilty to six counts of fraud and money laundering, including wire fraud, mail fraud, and conspiracy to commit both. Each fraud charge carries a potential sentence of up to 20 years in federal prison, while each money laundering charge could result in up to 10 years. Sentencing is scheduled for December 5, 2025.
As part of his plea agreement, Gustafsson has agreed to pay up to $1.3 million in restitution to victims and forfeit proceeds from the fraud, including funds held in a Swedish bank account.
The Aftermath
The Escobar Inc. saga serves as a cautionary tale about the dangers of too-good-to-be-true deals and the importance of due diligence when purchasing products online. The company’s use of high-profile marketing and association with a notorious name created an illusion of legitimacy that deceived many consumers.
As the tech industry continues to evolve, consumers are reminded to remain vigilant and skeptical of extravagant claims, especially from lesser-known companies. The downfall of Escobar Inc. underscores the necessity for transparency and accountability in business practices.
