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Bitconnect Scam: How to receive $2.5 Billion Refund from FBI?

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FBI has then taken on the task of investigating the crimes that have been committed by Bitconnect and announced that it is seeking information from victims.

BitConnect: A cryptocurrency that became famous only for developing a major Ponzi scheme that valued the coin (BCC)for a market cap of $2.5 billion in the peak of December 2017.

The company proposed its value, which was that the users would receive up to 10% return on their investment each month. Bitconnect also claimed to use the strategy of tiered-investment which was based on the total amount of funds that an investor will initially deposit.

On 3rd Day of January 2018, BCC reached the top of its all-time high at $463, before plunging by 65%, down to $5 by the end of January. Bitconnect attempted to repay all investors for $363 per BCC, but by the time the investors received the coins, the price had already gone well below $10, making their refunds practically worthless.

Bitconnect tried to pay back to all its investors for $363 as per BCC, but by the time the investors received the coins, the price had gone down below $10, making their refunds worthless.

After receiving a cease order which was issued by the regulators in Texas and North Carolina, Bitconnect then announced that they would be shutting down their exchange and lending operations. The assets of the company got froze and the founders are currently under investigation.

 

Seeking information from the Bitconnect victims:

After the dozens of lawsuits filed against the company, FBI has then taken on the task of investigating the crimes that have been committed and further announced that it is seeking information about victims who may have lost their money by the Ponzi scheme.

FBI has prepared a questionnaire Based on the type of questions that are being asked, it looks like that the FBI is in search of anyone who is possibly involved in promoting Bitconnect.

 

The questions that the questionnaire consists of are:

  • Where did you first hear about Bitconnect? (Friend, Youtube, Event, Other)
  • How much money did you invest in Bitconnect?
  • What was the username associated with your Bitconnect account?
  • Who referred you to Bitconnect (if applicable)?

Based on these questions the FBI is investigating and looking into the case.

 

In the end:

Ponzi schemes seem to be around for decades, they always look into finding new ways to emerge and trick unsophisticated investors into pouring money into them. At last, hopefully, those people who lost money learned the most important lesson from experience.

#Bitcoin

Bitcoin ATM Fraud: Four Canadian Men Declared Wanted

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Four men have been suspected and declared wanted by the police in connection with the Bitcoin ATM double-spending attacks.

According to a report published by the CBC. four men have been suspected and declared wanted by the police in connection with the double-spending attacks at Bitcoin ATMs. According to the report, a hundred and twelve transactions took place in just September 2018 out of which around sixty-six (half) of these took place in Calgary and others in Hamilton, Toronto, Winnipeg, Montreal, Ottawa, and Sherwood Park. However, the men that are suspected have unknown identities and the local police are seeking the help of the public in order to identify them.

 

Bitcoin ATM: Double Spend Fraud

Bitcoin ATMs installed in these areas had a zero-confirmation transaction which means that even without a single confirmation, the bitcoin atm allowed the withdrawals which made it possible for the suspects to perform double-spending in these ATMs.

The alleged persons performed a hundred and twelve transaction averaging to around $1800 per transaction in just ten days of time and made more than $200,000 out of it.

 

How does Double-Spending Work?

Double spend is made possible due to tools developed by Peter Todd, a bitcoin core developer who resides in Canada. The tool called replace-by-fee-tools allows the user to ‘unstuck’ and ‘stuck’ transaction by paying extra fees. However, the tools were not developed or endorsed for performing such criminal activity at a bitcoin atm.

According to Peter Todd, the double spend tool creates two transactions in sequence out of which the 1st transaction makes the stated payment to the stated address and the 2nd transaction double spends the same transaction with a transaction which has a greater amount of mining fee, making the payment only to the change address. Also, the user can choose to state that the 1st transaction additional OP-Return, Multisig as well as Blacklisted address outputs. As many bitcoin miners would not accept the transactions that have these kinds of outputs, instead they will accept the 2nd transaction that is a double-spend transaction which indeed assists the user to double spend.

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#Scam

OneCoin Founders Arrested: Charged Billions for Fraud

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Konstantin Ignatov and Ruja Ignatova, the founders of OneCoin Ponzi Scheme were arrested in Los Angeles airport on Wednesday, 6th March.

Konstantin Ignatov and Ruja Ignatova, the founders of OneCoin Ponzi Scheme were arrested in Los Angeles airport on Wednesday, 6th March. As per the announcement made by the US Attorney Office of the Southern District of New York, a US district attorney has charged the founders who are accused of securities fraud, wire fraud and money laundering by tempting people to invest billions in the cryptocurrency scam.

 

OneCoin was founded in Bulgaria in 2014 as a multi-level marketing project. The members of the project received a commission for attracting more and more investors to buy the OneCoin cryptocurrency. The network of the company grew massively and had already attracted more than 3 million investors globally.

 

According to the investigation, OneCoin made more than $3.77 billion in sales revenue and around $2.25 billion in profits between the 4th quarter of 2014 and 3rd quarter of 2016.

 

The district court attorney said that the founders performed an old-school pyramid scheme on a new-school program which compromised the probity of the financial system of New York and extracting billions from people in the form of investments.

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#Explained

Exposed: Japan Growth Rate Scandal, Fake Economic Data

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Recently shocking news regarding the fraud in Japan's growth rate came into flash. Around 40% of the total economic data were found to be fake.

Recently shocking news regarding the fraud in Japan’s growth rate came into flash. The scandal was cast at a very large scale. Around 40% of the total economic data reported by the Japan Govt. were found to be fake. This storm is going to affect investors and businesses who were on a different page investing in the country on the basis of fake data.

 

It’s not a recent fault, it has been there for so long:

Those who are confused that this scam was being performed for only the recent years and reports, the truth is, it is not a recent fault. It has been there for so long. As per reports, around 40% of 56 economic policies of Japan has errors. Thus, the country has been producing and analysis over the years on erroneous policies. These economic policies have their basis on fraudulent data.

Thus, not only the recent reports, rather over the years, this scam has been continuing.

 

Erroneous Methods:

It seems that the knowledgeable economic policymakers were not aware of the glitch in their policies for such a long time. It is quite surprising. Let us talk about a recent survey. Recently, around 500 employees were collaborated to work on a model related to the growth of Japan. These employees were paid more than the regular same designation workers to focus on the survey with more interest.

The employee reported that the erroneous methods have affected around 20 million people. The monetary amount that Japan has incurred is around $490 million. If we add the additional cost like monitoring, it would sum up to around $759 million!

The prime minister of Japan, Shinzo Abe is very upset and annoyed with these results. This loss would certainly affect the financial condition of Japan. In related to it, the Prime Minister has announced a paltry of $5.9 million from the next year’s budget to make up this loss. Also, around 22 officials which were found to be guilty in this scam are suspended and actions are being taken against them. This list also includes the Labour Minister of Japan,  Takumi Nemoto

 

Bank of Japan has been assigned the work for calculations:

The impact of this scam is huge that the estimated growth rate of Japan that was supposed to around 3.3 % has been declined to 2.8% with the modified policies.

The bank of Japan is considering to do all the calculation once again to measure the final loss. It is waiting for the results of the investigations made by the Japan Govt. before starting its recalculation.

The Bank of Japan has been dependent on labor ministry for so long and it would be interesting to see how the BoJ manages to recalculate this loss.

 

No to crypto- Bank of Japan:

Amidst this shocking news, the BoJ has continued to have a negative view about crypto space. The rumors were strong regarding some approval of crypto in perspective of hosting of Olympics next year. But BoJ has clarified and warned people for crypto-payments. However, if we look, on the other hand, crypto could have helped the BoJ during this loss. Since the bank is looking for some better alternatives, the blockchain technology would have provided that credibility to BoJ. But this idea would not be supported by sophisticated officials as it would allow the bank to see each person’s wallet through a third party app which may concern about security and privacy. But for now, the bank of Japan has neglected all its views on using cryptocurrencies.

 

This news is going to adverse the economic and financial conditions of Japan. Many of the investors and businessmen are thinking as if they have been frauded by the growth rate and other erroneous reports produced by the government. They might think of taking a U-turn from their investments in Japan. Also, the loss incurred is so high. The Japan government is going to face a lot of difficulties such as calculating the exact loss, the change in policies or come with new policies etc. They ould also have to prove the investors that the new policies are not fraudulent and it maintains the accuracy.

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