Scams in the blockchain industry are increasingly common. The US Securities and Exchange Commission (SEC) recently exposed the scammers. It is preparing to crack down rigorously. Here’s what it is.
A massive scam to rob thousands of crypto investors
The SEC, the US securities agency, is filing fraud charges against the leaders of a crypto system. In a chirpCoinDesk said on Jan. 5: “Fake Blockchain Deal Cost Scammed Investors Over $45 Million, European Commission Report SaysIt appears that alleged scammers, including Neil Chandran, have used fake blockchain technology to defraud cryptocurrency investors.
The US securities agency has indicated in an official document that the fraud concerns CoinDeal. The latter is the cryptographic system that served as fraudulent investment scheme for the defendant. The alleged scammers made their victims believe that they were investing money for the sale of blockchain technology.
The document released on the case states:According to the SEC complaint filed in the US District Court for the Eastern District of Michigan, Chandran, Davidson, Glaspie, Knott and Mossel falsely claimed that investors could generate extravagant returns by investing in a blockchain technology called CoinDeal that would be sold for trillion dollars to a group of large and wealthy buyers“.
Lead a life of luxury with stolen funds!
Daniel Gregus, director of the SEC’s Chicago regional office, said:We allege that the defendants falsely claimed that they have access to valuable blockchain technology and that the upcoming sale of this technology would generate returns in excess of 500,000 times for investors.“.
Funds in the hands of scammers were used to buy luxury cars and more. The scammers also offered themselves real estate and a boat. Neil Chandran has also invested some of the funds in his many other businesses.
You should know that Neil Chandran is grounded since last year for the same case. Today, the SEC accuses him of violating US securities laws along with the other alleged scammers. Note that there is a cryptocurrency exchange known as CoinDeal. This is run by Adam Bicz and Kajetan Maćkowiak and apparently has nothing to do with Chandran’s fraudulent scheme.
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Far from dampening my enthusiasm, a failed investment in a cryptocurrency in 2017 only increased my enthusiasm. I therefore decided to study and understand the blockchain and its multiple uses and to convey information related to this ecosystem with my pen.