3 Individuals Charged for 1.89 B Crypto scams

stompix

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Quote from: Poker Player on January 30, 2024, 11:58:29 PM

From what I see in the article it is a cloud mining scheme that offered high returns, but did not really exist. A classic ponzi.

But it was a really elaborate one, crypto blogs only copy paste what the SEC said but more on the story here, it wasn't just cloud mining, it was also an investment fund, then a metaverse scheme, so on and on:
https://www.theguardian.com/technology/2024/jan/24/hyperverse-crypto-scheme-targeted-developing-countries-before-collapse-left-some-investors-suicidal

Almost on par with OneCoin, but with a more disgusting modus operandi behind it, targeting specifically some countries and regions and adjusting their promises accordingly, plus they did that because a scam that take place there takes longer to reach the western world and stay hidden, it's only when news starting popping up here that FCAs started to look at it.
So it was a bit like, let's scam people in Nepal and Ghana for $100 each cause nobody is going to care!

Quote from: Davidvictorson on February 03, 2024, 03:45:55 PM

What happens to investors funds and how to they recover them?

The irony in it is that a lot of the missing funds are actually in the early lucky investors pocket who managed to make a profit, the cost of all the promoting and wages paid to the guys doing so, so good luck getting anything significant back.

SFR10

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Quote from: Jating on January 30, 2024, 07:35:00 PM

Not sure if there are victims of this fraud from our community.

Unfortunately, there are a few victims in local communities.

Quote from: Jating on January 30, 2024, 07:35:00 PM

So it's just another slap on their risk for this criminals.

I completely agree that all of them deserve to get more severe punishments, but at least they're giving promoters the same type of treatment or rather punishment as the co-founder ^{[it's a great example for these so-called influencers with little to no knowledge about the things they tend to promote]}.

Davidvictorson

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Victims of scams, have some traits in common. They are highly inexperienced people that are non-business and non-investment minded. If they had done any business, they would know that there is no business that gives them returns that are too high. Usually, victims of scams are normally greedy. They do no do their homework, they want someone doing it for and so they fall for it.
Scammers feed on their fear of missing out and use it psychologically to their advantage. See the people that invested in this cloud mining business becasue they feel that the Lee was good and has good experience too. What happens to investors funds and how to they recover them?

Lucius

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The link does not say anything about the defendants having to return the money (or all the money) that they acquired illegally, but that does not mean that everything that was found was not taken from them. Considering that they have been doing this for years, they can refer to the fact that they have already spent part of the money, and if they were at all smart, each of them hid part of the money that they will be able to spend when they get out of prison.

In the end, the world is big and there are still countries where people can lie low and enjoy themselves far outside the radar of the US authorities.

zasad@

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Quote from: Lucius on February 02, 2024, 08:09:37 AM

The problem is not only with scammers, but also with hyperidiots who, thanks to their ignorance and greed, make such things to happen. It is also a problem that the laws for such frauds foresee relatively low penalties, because this is exactly what motivates some people to engage in such ventures.

If these scammers managed to hide only 10% of what they stole, in 5 or 10 years after prison they will still be rich and have more than they could earn in 10 ordinary lives. In addition, with good governance in prison, it is possible to serve only part of the sentence and be out much sooner.

If you make a deal with American justice, then the agreement will say that the culprit is obliged to return all the stolen funds. If the fraudster keeps even a small part of the stolen money and this is later known, then all the terms of the deal will be canceled and the fraudster will have to sit in prison for a very long time time. In Europe the conditions are similar, but I'm not exactly sure. And in Russia, cellmates and the administration can take all the money from a fraudster in prison.

Lucius

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The problem is not only with scammers, but also with hyperidiots who, thanks to their ignorance and greed, make such things to happen. It is also a problem that the laws for such frauds foresee relatively low penalties, because this is exactly what motivates some people to engage in such ventures.

If these scammers managed to hide only 10% of what they stole, in 5 or 10 years after prison they will still be rich and have more than they could earn in 10 ordinary lives. In addition, with good governance in prison, it is possible to serve only part of the sentence and be out much sooner.

zasad@

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Quote from: SquirrelJulietGarden on February 01, 2024, 06:32:02 AM

Scammers can use Ponzi scheme to scam naive people and they can use many tools which can be attached to their Ponzi projects, to scam. Cryptocurrencies are tools for those scammers but Bitcoin or cryptocurrencies are not scam by itself.

Saying like cryptocurrency scam is like anti-cryptocurreny. They must write like "Cryptocurrency is used to scam in a Ponzi HyperFund". Same for Bitcoin like "Bitcoin is used for scam in a Ponzi project."

I studied this issue a little in Russia, and I think that the situation is the same in other countries. Some people make money from
that money. They know that this project is a potential scam and invest in it only with the hope that they will get their money back and make a profit, and for this they attract and teach other people this scam.

pakhitheboss

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After reading the press release they certainly scammed innocent or greedy contract buyers with the concept of cloud mining. I have seen many websites that are related to the crypto niche promoting cloud mining contracts as they offer a good percentage through affiliate marketing. What I wonder is how these three scammers got caught when there were plenty of ways to not get caught. I am reading this for the first time that crypto scammers got caught, looks to me as if they were first-timers who were not at all equipped to hide themselves.

Crypto scams have become quite common, but getting caught by authorities is now becoming a new normal. It is evident that the cybercrime unit is now well equipped and is getting properly funded. They are recruiting the right individuals to handle cybercrime which sadly increased 125% from 2020 to 2021 according to a report that I read earlier.

SquirrelJulietGarden

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Quote from: Poker Player on January 30, 2024, 11:58:29 PM

From what I see in the article it is a cloud mining scheme that offered high returns, but did not really exist. A classic ponzi.

I see it is a very classic Ponzi scam.

Quote

If a not well known scheme like these can scam $1.89B one understands why there are so many scam schemes in the cryptocurrency world.

Apart from that, in the news it does not say if they have returned part of the money to get those reduced sentences or are those imposed by the legislation for that type of crime, which I like.

I dislike how this was written.

Scammers can use Ponzi scheme to scam naive people and they can use many tools which can be attached to their Ponzi projects, to scam. Cryptocurrencies are tools for those scammers but Bitcoin or cryptocurrencies are not scam by itself.

Saying like cryptocurrency scam is like anti-cryptocurreny. They must write like "Cryptocurrency is used to scam in a Ponzi HyperFund". Same for Bitcoin like "Bitcoin is used for scam in a Ponzi project."

zasad@

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Russian wisdom “Spring will show who shit where.” (C)
I remember the case with a similar investment pyramid of Finiko in Russia, where the damage was greater, up to 4 billion, but the money was not returned and all the criminals have not yet been found.

Poker Player

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From what I see in the article it is a cloud mining scheme that offered high returns, but did not really exist. A classic ponzi.

Quote from: SquirrelJulietGarden on January 30, 2024, 10:05:07 PM

I did not know any of HyperFund, HyperTech, HyperCapital, HyperVerse, HyperNation. I have never read about them on cryptocurrency websites like Cointelegraph, Coindesk, BitcoinMagazine and the likes. I have never read about them in Bitcointalk discussions before today.

Chance for members in Bitcointalk are victims of those scams exist but not too big. If they were scammed and were actively in Bitcointalk, likely they already shared those scams here for warning and discussions.

If a not well known scheme like these can scam $1.89B one understands why there are so many scam schemes in the cryptocurrency world.

Apart from that, in the news it does not say if they have returned part of the money to get those reduced sentences or are those imposed by the legislation for that type of crime, which I like.

SquirrelJulietGarden

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Part of the report.

Quote

Sam Lee, 35, an Australian citizen residing in Dubai, United Arab Emirates, was charged in an indictment unsealed today for allegedly co-founding HyperFund, also known as HyperTech, HyperCapital, HyperVerse, and HyperNation. Rodney Burton, 54, of Miami, and Brenda Chunga, 43, of Severna Park, Maryland, were promotors of HyperFund.

I did not know any of HyperFund, HyperTech, HyperCapital, HyperVerse, HyperNation. I have never read about them on cryptocurrency websites like Cointelegraph, Coindesk, BitcoinMagazine and the likes. I have never read about them in Bitcointalk discussions before today.

Chance for members in Bitcointalk are victims of those scams exist but not too big. If they were scammed and were actively in Bitcointalk, likely they already shared those scams here for warning and discussions.

TravelMug

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It's really hard to find where those money are, maybe they have used it already, or just part of it are in still in the hands of this criminals. And based on the documents only 1 individual is charge with two counts, so that's 10 years, but the other two has one count only so 5 years it found guilty. So I do agree that that sentence is light as compare to the biggest scams in US not just crypto related scams. It is staggering indeed if you look at home much money is involved, but maybe they have cooperated with authorities or their lawyers might settle for a plea or something that one it seems that the sentence is not fair or light.

Jating

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https://www.justice.gov/opa/pr/three-individuals-charged-roles-189b-cryptocurrency-fraud-scheme

Not sure if there are victims of this fraud from our community. But then again, if you look at the jail time, it's 5 years for this criminals (for each count). So it's just another slap on their risk for this criminals. I mean they could get out in the next crypto bull run or maybe much earlier and then think again of another scams that they will pull off.

But we can't question the US authorities though, that's who justice is for them. This is a billion dollar scam, and not just those couple of millions.

And I say that if they don't return the money, then we might not call this justice after-all.

Topic: 3 Individuals Charged for 1.89 B Crypto scams (Read 159 times)