Floyd Mayweather and DJ Khaled Fined for Promoting Possibly Fraudulent Cryptocurrency

Floyd Mayweather and DJ Khaled are paying up after promoting initial coin offerings of new cryptocurrencies without revealing to investors that they were being paid for their trouble.

 

The Securities and Exchange Commission made Khaled and Mayweather the first people to be charged with ICO violations. Both the record producer and the semi-retired boxer touted the benefits of Centra Tech Inc.’s cryptocurrency ahead of its first public offering on their social media without sharing that they were paid by the company to do so.

“Get yours before they sell out, I got mine,” Mayweather wrote of the coins on his Twitter.

Khaled called the cryptocurrency a “game changer” ahead of its offering. Khaled and Mayweather were paid $50,000 and $100,000 respectively. In addition to that, Mayweather drew the ire of the SEC for failing to disclose another $200,000 in promotional payments from 2 more ICOs.

Khaled and Mayweather agreed to a settlement where they neither admitted nor denied the findings of the SEC. As part of the settlement, Mayweather will pay $300,000 in disgorgement, a $300,000 penalty and $14,775 in interest. Khaled will have to pay $50,000 in disgorgement, a $100,000 penalty and $2,725 in interest.

Centra is in further trouble that goes beyond their spokespeople being fined. The SEC and the Justice Department have filed civil and criminal charges against the company, alleging that the ICO promoted by the stars was entirely fraudulent. The founders of Centra are currently facing charges for “making false claims about their product and about relationships they had with credible financial institutions” and going so far as to create “a fictitious Centra Tech CEO,” according to a DOJ press release.


Source
Author: ALEX GALBRAITH
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U.S. Trader Fined $1.1 Million and Sentenced to 15 Months for Commiting Bitcoin Fraud

According to a report by Bloomberg, published November 13, 2018, U.S. resident named Joseph Kim has been fined $1.1 million and sentenced to 15 months in prison for orchestrating fraudulent schemes related to bitcoin (BTC), and litecoin (LTC), thus duping his employer and several other customers of their money.

Illegal Transfers and Fund Misappropriation
In 2017, the U.S. Commodity Futures Trading Commission (CFTC) found out that Kim had transferred $601,000 worth of bitcoin and litecoin from his employer’s cryptocurrency exchange wallet to his wallet.

The misappropriation of funds was done sometime between September and November 2017, when Kim used to work for a Chicago based trading firm.
Later, Kim was interrogated by the firm’s officials regarding the illegal transfers. However, at the time, Kim falsely claimed that he moved the digital currencies because of the platform’s security concerns. Subsequently, the company discovered the illegal transfer of funds in November 2017, after which Kim was fired.

In an attempt to better his sorry situation, Kim started to solicit funds from individual investors stating that he had left his previous job to start his trading venture. Kim boasted about his “low-risk virtual currency arbitrage strategy,” and was able to hit the right chord with some investors.

Finally, Kim was successful in accumulating close to $45,000 from five investors who he had tricked into the fraudulent scheme. The investors entrusted Kim with their money for good investments in the cryptocurrency market.
Much to Kim’s misfortune, he lost all $45,000 as a result of poor trading decisions. To hide the losses, Kim even managed to forge the account statements sent periodically to investors to show them profits.

However, luck ran out for Kim when he got slapped with $1,146,000 fine by the U.S. CFTC. Also, the CFTC also permanently banned Kim from participating in crypto trading, and from soliciting funds.

Regarding the dramatic turn of events leading to Kim’s arrest, director of enforcement at the CFTC, James McDonald stated:

“Today’s Order stands as yet another in the string of cases showing the CFTC’s commitment to actively police the virtual currency markets and protect the public interest.”

U.S. SEC Having a Busy Time
Keeping a vigilant eye over the players in the crypto industry has been a tough cookie to crack for regulatory bodies the world over.
BTCManager reported on November 8, 2018, how the U.S. SEC penalized EtherDelta founder for failing to register cryptocurrency exchange despite offering the buying and selling of security-like assets on a secondary market.


Source
Author: Aisshwarya Tiwari
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Users Lured Into Paying Non-Existent Debt Through Bitcoin ATMs

Scammers have figured out how to con $50,000 from Australian residents, tricking them in to pay off a non-existent debt in a classic fraud. Around four casualties from eastern Melbourne have fallen for the trap, according to news media reports.

Purportedly, the scammers would call the people and persuade them that they have an outstanding tax debt and that, if they don’t pay it through a Bitcoin ATM in Braybrook, they will be imprisoned. The victims would then withdraw their savings from their banks, travel to Brabryook’s Bitcoin ATM and pay off the fake debt to a predefined Bitcoin account.

As indicated by the police, this sort of plan targets helpless individuals who are effortlessly persuaded that their immigration status is undermined.

Acting Detective Sergeant Katherine Lehpamer stated that

“We trust that there are various victims out there who have not revealed the issue for some reason, they might be here on visas or they don’t know that authorities would never tell them to store cash into an ATM.”

Authorities have more than once asked people to be particularly careful while getting telephone calls from institutions and to double-check with the relevant organizations the value of the claims. Sergeant Lehpamer notes on the issue:

Anybody getting a call along these should make enquiries with the relevant authority before paying any cash or giving any bank account or personal details over the phone.

What is shocking, though, is that Australia doesn’t even accept tax payments made in cryptocurrencies. While there are sure ventures which allow residents to pay their bills with handling the bills, they basically act as delegates handling the bills for the benefit of the user accepting the same amount in cryptocurrencies.


Source
Author: Knightrider
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UK Financial Watchdog Issues Second Crypto ‘Clone Firm’ Warning This Week

The UK Financial Conduct Authority (FCA) has sounded an alarm over yet another clone company on the cryptocurrency scene. In a second such warning in a week, the financial regulator said on Wednesday that a company called Good Crypto was impersonating FCA-authorized firm Arup Corporate Finance to lure and possibly scam investors.

LIONBIT

Currently, the website of the fake venture is still live, offering a wallet that supports various digital currencies, including Bitcoin (BTC), Ethereum (ETH), Ripple (XRP), Litecoin (LTC), Bitcoin Cash (BCH), NEM (NEM), NEO (NEO) and Dash (DSH). The firm assures investors that the service is “highly stable and secure”.

Apart from the questionable advertisement, Good Crypto provides contact details, which the FCA warns “may be false” or “mixed” with details of Arup. The regulator further noted that the real, registered firm has no association with Good Crypto.

TIP

The FCA warning comes just a day after the authority brought another suspicious operation to public attention. Fair Oaks Crypto has been revealed to be manipulating investors by claiming the name, the company reference number, and the address of asset management and advisory services provider Fair Oaks Capital.

“[F]raudsters usually use this tactic when contacting people out of the blue, so you should be especially wary if you have been cold called. They may use the name of the genuine firm, the ‘firm reference number’ (FRN) we have given the authorised firm or other details,” the FCA stated.

As cryptocurrencies are not regulated by the FCA, investments are not protected by UK’s Financial Services Compensation Scheme and victims are unlikely to recover lost funds. Thus, FCA has asked investors to be vigilant when investing in any company, noting that they should check first if the company is in the Financial Services Register or the Interim Permission Register. In the event that one finds a clone company, they should report the company to the FCA to stop the fraudulent activities and bring the criminals to justice.

Earlier this year, the FCA launched a cryptocurrency task force in collaboration with the Bank of England to examine the various ways cryptocurrency technologies can be supported and regulated by the authorities. In another attempt to protect investors, the FCA opened investigations on 24 cryptocurrency businesses to determine whether they require FCA authorization.


Here at Dollar Destruction, we endeavour to bring to you the latest, most important news from around the globe. We scan the web looking for the most valuable content and dish it right up for you! The content of this article was provided by the source referenced. Dollar Destruction does not endorse and is not responsible for or liable for any content, accuracy, quality, advertising, products or other materials on this page. As always, we encourage you to perform your own research!

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Author: Deyana Laguna
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Crypto Stock Exchange Operator Pleads Guilty to Fraud

The man behind two now-defunct cryptocurrency investment sites has pled guilty to securities fraud and obstruction of justice charges.

The U.S. Attorney for the Southern District of New York announced the guilty plea on Monday, coming days after it was reported that Montroll was close to a deal with prosecutors. Jon Montroll was arrested back in February by U.S. authorities, as CoinDesk reported at the time, in connection with securities investment platform BitFunder and crypto exchange site WeExchange.


 


Montroll was accused of running an unregistered securities exchange, as well as providing info to investigators that was described as “misleading.” Montroll also allegedly “converted a portion of WeExchange users’ bitcoins to his personal use without the users’ knowledge or consent,” according to a statement published Monday.

He notably was accused of lying about the number of bitcoins available to BitFunder and WeExchange users after the latter was hacked, as well as committing perjury while testifying to the U.S. Securities and Exchange Commission (SEC).

 

WeExchange lost around 6,000 bitcoins at the time of the hack, which left the platform insolvent, as previously reported.

Manhattan U.S. Attorney Geoffrey Berman said in a statement Monday:

“As he admitted today, Jon Montroll deceived his investors and then attempted to deceive the SEC. He repeatedly lied during sworn testimony and misled SEC staff to avoid taking responsibility for the loss of thousands of his customers’ bitcoins.”

Though the case was originally brought by the SEC, the FBI and Southern District of New York Attorney’s office prosecuted Montroll under criminal charges. U.S. District Judge Richard Berman will sentence Montroll at an undetermined future date.


Here at Dollar Destruction, we endeavour to bring to you the latest, most important news from around the globe. We scan the web looking for the most valuable content and dish it right up for you! The content of this article was provided by the source referenced. Dollar Destruction does not endorse and is not responsible for or liable for any content, accuracy, quality, advertising, products or other materials on this page. As always, we encourage you to perform your own research!

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Author: Nikhilesh De
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More than $8.5 Million in Bitcoin Seized by Israeli Police

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1,071 BTC SEIZED BY ISRAELI POLICE

A massive anti-money laundering action has been carried out by the cyber department of the State Attorney’s Office. It filed an indictment, alleging that Hilmi Git had managed to commit more than 20,000 fraudulent transactions using Israeli credit cards, laundering the money through the Bitcoin network.

Halmi Git, a resident of Hebron, has been accused of multiple offenses of credit card fraud, providing means for committing a crime, carrying out fraudulent trade activity, and laundering the proceeds through Bitcoin. It is reported that the Git managed to accumulate a total of 1,071 Bitcoin over the course of his crimes.

At press time, Bitcoin is trading at $7,342.21, putting the total value of Git’s fraud at a little over $7.8 million.

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WEB OF CRIME

According to the indictment, Git ran a network of forums and websites used to provide information on how to commit a range of computer offenses. One such forum provided is reported to have provided stolen credit card information. While entry to the forum was free, members could purchase a “VIP” membership to receive “fresh” credit card data. Git also published different guides in violation with the country’s Computers and Money.

But wait… there’s more! Reportedly, Git also ran another scam, fraudulently selling mobile phones – often members of his own forums – at substantially reduced prices.

The indictment describes a scheme in which Git would request that the customer transfer his money for the phone, after which point he would proceed to block the customer from the forum without ever actually having sent the customer their phone. He would go on to publish a positive feedback message on behalf of the deceived customer, expressing gratitude for the cheaper mobile phone.

ALL PAYMENTS MADE IN BITCOIN

The Israeli State Prosecutor’s Office claims that Git had requested all the payments to be made in Bitcoin. As such, he has reportedly managed to accumulate more than 1,071 Bitcoin between 2008 and 2018.

The Bitcoin wallet of the accused has been seized and the funds in it are to be confiscated if and when he is found guilty of his crimes.

The prosecution also seeks an extension of Git’s confinement until the end of the trial due to potential flight risk as well as concerns that having access to the internet will allow Git to “continue carrying out the criminal enterprise he established over the past decade.” Given the defendant’s thoughts on his actions, the concern seems more than warranted.

Showing no remorse whatsoever, Git was quoted as saying:

“We are thieves, from wherever we can take money – we’ll take it, no matter where – from Israel, The US or even the moon – we will reach it and use it.”

What do you think will happen to those 1,071 Bitcoin if Git is found guilty?


Here at Dollar Destruction, we endeavour to bring to you the latest, most important news from around the globe. We scan the web looking for the most valuable content and dish it right up for you! The content of this article was provided by the source referenced. Dollar Destruction does not endorse and is not responsible for or liable for any content, accuracy, quality, advertising, products or other materials on this page. As always, we encourage you to perform your own research!

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Author Georgi Georgiev 
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