Tag: PONZI

Ohio man pleads guilty to fraud over $30M crypto scam promising 15% monthly

by Cointelegraph

The man behind a multi-million dollar cryptocurrency scam has pleaded guilty to fraud this week according to the U.S. Department of Justice.

Ohio man Michael Ackerman could face up to 20 years inside following the guilty plea for defrauding investors in a crypto scam he orchestrated in 2017. The too good to be true scheme lured hundreds of investors who deposited USD into a crypto fund called the Q3 Trading Club promising 15% monthly returns.

U.S. attorney for the Southern District of New York, Audrey Strauss, announced the guilty plea on Sept. 8 stating that Ackerman admitted to causing losses of more than $30 million from victims.

“As he admitted today, Michael Ackerman raised millions of dollars in investments for his fake cryptocurrency scheme by falsely touting monthly returns of over 15 percent.”

Strauss added that he falsified documents to convince investors into believing his fund had a balance of more than $315 million. In reality, the fund never had a balance over $5 million according to the DoJ.

It added that Ackerman stole $9 million from investor contributions to “bankroll a lavish lifestyle” that included real estate, jewelry, vehicles, travel, and personal security services.

The 52-year-old pleaded guilty to charges of wire fraud and agreed to make recompense of at least $30 million while forfeiting $36 million in cash, real estate, and jewelry he fraudulently acquired. Ackerman is due to be sentenced on January 5, 2022.

He was initially charged by the Securities and Exchange Commission in February 2020 for violating securities laws. At the time it was reported that he targeted physicians in particular via a private “Physicians Dads Group” on Facebook.

Related: Q3 Crypto Ponzi Victims File Class Action Lawsuit Against Wells Fargo

Ackerman, who was a New York Stock Exchange institutional broker, operated as part of a trio that included James Seijas, a former financial advisor for Wells Fargo, and surgeon Quan Tran.

Victims of the scam sued Wells Fargo in April 2020 for failing to investigate the activities of an employee.

Source

Tagged : / / / /

Eastern European victims sent $815M to Ponzis and scams in the past year

by Cointelegraph

Recent research has revealed that Eastern Europe remains a very high source of cybercrime activity — both from victims to scams, and from users to darknet markets — in the cryptocurrency sector.

Cryptocurrency addresses based in the Eastern European region have the second-highest exposure to illicit activity after Africa, according to a report published on Sept. 1 by blockchain research firm Chainalysis. However Eastern Europe has a much larger overall crypto economy than both Africa and Latin America (which came in third.) The findings echo research carried out last year.

The research analyzed the illicit share of cryptocurrency activity by region between July 2020, and June 2021. It revealed that Eastern Europe-based crypto addresses and wallets sent $815 million to scams and Ponzi schemes over the period.

“As is the case with all regions, scams make up the biggest share of funds sent from Eastern Europe to illicit addresses — we can assume that most of this activity represents victims sending money to scammers.”

Chainalysis observed that more cryptocurrency is sent to darknet markets in Eastern Europe than other regions. There is a thriving Russian language darknet market called Hydra which, it claims, is the world’s largest.

Drilling down into geographic breakdown by country, the research found that Ukraine was by far the top nation in the region with more internet traffic to scam websites than any other country.

One particular scam accounted for more than half of the value sent in the region. Finiko, a Russia-based Ponzi scheme that collapsed in July 2021, promised huge returns and launched its own token, FNK.

According to the report, the Finiko scheme received more than $1.5 billion in BTC in over 800,000 separate deposits between December 2019 and August 2021.

Related: Australians lost over $25 million to bogus crypto investments

Addresses in Eastern Europe have also been associated with ransomware, with $46 million being sent to suspect wallets in the region. The analytics firm attributed a lot of this to Russian hacker groups, stating “many of the most prolific ransomware strains are associated with cybercriminal groups either based in or affiliated with Russia,” using Evil Corp as an example.

A year ago, Cointelegraph reported that Evil Corp demanded a $10 million crypto ransom to restore access to Garmin’s navigation solutions after its network was compromised.

Source

Tagged : / / / / / / /

Turkish prosecutors investigate alleged $119M Dogecoin mining scam

by Cointelegraph

Turkish media reports that authorities there are investigating an alleged Dogecoin mining scam that  pulled the rug on investors after amassing $119 million worth of deposits.

An Aug. 23rd report from local channel TV100 broke the news, with police identifying pseudonymous online avatar “Turgut V.” as the scheme’s suspected operator.

Authorities believe that Turgut and 11 associates managed to gather close to 350 million Dogecoin valued at $119 million before disappearing.

Turgut reportedly solicited investments from 1,500 Turkish citizens, drumming up excitement for the Dogecoin “mining” operation at in-person networking events held at ritzy locations, and by using a Telegram group online. Investors were promised returns of 100% in 40 days and reportedly paid returns for around 3 months.

Investors were told that the Dogecoin they sent would procure new equipment to mine DOGE. Similar to Bitcoin, Dogecoins are created through Proof-of-Work mining, where network participants compete to validate transactions and produce the next block by computationally solving complex equations. The miner that solves the equation mines the network’s next block, also receiving all of the crypto contained within it as a reward.

The operation ran smoothly for its first three months, with early investors receiving their returns as promised. However, after the scheme’s total value locked (TVL) peaked at 350 million Dogecoin during its fourth month, the funds reportedly disappeared.

The Chief Public Prosecutor’s Office of the Turkish suburb Küçükçekmece is now carrying out an ongoing investigation to locate Turgut and his 11 associates. Authorities have issued an order restricting Turgut and his partner Gizem N. from traveling outside the country.

Related: Australians lost over $25 million to bogus crypto investments

The recently surging popularity of crypto assets in Turkey has brought with it an increase in scammers seeking to leverage digital assets to dupe victims out of their hard-earned cash.

At the end of April, Turkish authorities jailed six suspects associated with the collapse of local crypto exchange Thodex. The exchange had abruptly halted withdrawal services earlier that month, stranding users’ funds on the platform.

Also in April, four employees of the local Vebitcoin exchange were arrested for allegations of fraud just a day after Vebitcoin announced it would cease operations.