US Regulator Accuses Head of Defunct British BTC Company $147 Mil Fraud

[jdarren]

A US commodities regulator has filed a lawsuit against a British crypto company and its former principal for misappropriating at least 22,858,322 Bitcoin. These guys apparently 'exploited public enthusiasm' by saying their traders could generate 1.5 percent a day in profits.

How in the world do we resist against something like this happening again?

Ciphertrace crypto theft report totaled $1.21 billion in the first quarter which is absolute madness. 

https://gadgets.ndtv.com/internet/news/us-regulator-accuses-head-of-defunct-british-bitcoin-company-of-usd-147-million-fraud-2055776

[Theb]

There's no questions asked that the fraud was done by Control-Finance but the problem really is will they have the money to pay for the damages for their victims? Ponzi schemes like this who are caught doesn't have any assets left to liquidate to cover all the damages, them being dissolved over a year ago in their country says that they don't have anything left to pay for anything and most likely what they would get is just jail time rather than expecting their victims to have their money back.

[timerland]

A US commodities regulator has filed a lawsuit against a British crypto company and its former principal for misappropriating at least 22,858,322 Bitcoin. These guys apparently 'exploited public enthusiasm' by saying their traders could generate 1.5 percent a day in profits.

Of course a scheme that is offering such absurd returns would go bust. From a legal standpoint, they probably never even have had the proper licenses to accept investments in the first place, let alone the mechanisms to allow them to make that much profit sustainably.

It'll be interesting how the case will turn out though, given it goes across jurisdictions and it'll probably be harder to prosecute those in charge.

How in the world do we resist against something like this happening again?

Just use your common sense and don't invest in something that offers ponzi or ponzi-like returns? It's not like this is something obscure at all.

[buwaytress]

I'm guessing Ciphertrace reports don't even factor in those over the counter and off chain frauds and scams that don't get reported. You know, like guys investing in intra-wallet ponzis. Yeah, like you know, send me money via Coinbase  or those Telegram games, or even gamblers loaning each other funds within a casino app/site. It happens a lot, I'm somewhat embarassed to know it does heh.

How in the world do we resist against something like this happening again?

Again? Can't. But education and awareness are to me going to work a lot more than regulation and enforcement (but of course the latter should go hand in hand). Got to teach people how to differentiate scams, if you keep sheltering them, you delay the inevitable.

[gentlemand]

Never heard of this before. That's a substantial amount of BTC.

As for how to stop it, you can't. Even if they make some sort of registration compulsory they can just sail past it by placing an ad or even nothing fancier than a post on Facebook. All you need these days is an email and Bitcoin address and you may get enough saps before any type of authority cottons on.

Until there's a cure for stupidity and greed they will be an infinite resource. I don't really have any sympathy for anyone who fell for this.

[teddyelwyn]

I understand how people that are crypto native can have little sympathy for these sorts of instances but what about the people who really don't have much background knowledge of crypto? My worry is it's going to put a bad taste in their mouth and any of those who hear this story. Yes we need regulation from companies that specialize in AML like ciphertrace but we also really need proper education and onboarding for these types of companies to make sure it doesn't carry on overtime.

[gentlemand]

I understand how people that are crypto native can have little sympathy for these sorts of instances but what about the people who really don't have much background knowledge of crypto?

It's precisely nothing to do with crypto. It's common sense. If a totally anonymous stranger is offering you guaranteed returns that sound ludicrously good then there is only one conclusion to make.

[dothebeats]

This is actually not cryptos doing but gullible people allowing other people to get their money off of their hands in hopes of handsome returns in a short span of time. This is nothing new, and also nothing to be proud of as well. As long as there are people willing to be scammed/robbed off of their money, problems like this wouldn't end no matter how many regulations they put in place to combat these kinds of activities.

Should be 22k btc and not 22-M as stated on the article as that would totally be over the 21-M hard cap of the supply, anyway.

[Kemarit]

I understand how people that are crypto native can have little sympathy for these sorts of instances but what about the people who really don't have much background knowledge of crypto? My worry is it's going to put a bad taste in their mouth and any of those who hear this story. Yes we need regulation from companies that specialize in AML like ciphertrace but we also really need proper education and onboarding for these types of companies to make sure it doesn't carry on overtime.

What kind of education? This community has been very active fighting scams and calling out ponzi like programs if it chooses this forum. But the problem is that individuals specially newbies still fall for this kind of trap because they see different. They are being lured of a huge returns, but if they are going to use their common sense and be logical, they wouldn't be victims here.

[DaCryptoRaccoon]

for misappropriating at least 22,858,322 Bitcoin.

Might be hard as the cap on bitcoin is 21 Million.. How could they have misappropriated more than is in the ecosystem.
It would also mean the entrire supply of bitcoin moved via this "company" which I highly doubt.
Further to this there is no news of this in the UK.

[jdarren]

This is actually not cryptos doing but gullible people allowing other people to get their money off of their hands in hopes of handsome returns in a short span of time. This is nothing new, and also nothing to be proud of as well. As long as there are people willing to be scammed/robbed off of their money, problems like this wouldn't end no matter how many regulations they put in place to combat these kinds of activities.

Should be 22k btc and not 22-M as stated on the article as that would totally be over the 21-M hard cap of the supply, anyway.

Thank you for picking that up. I didn't even notice but you're right about the hardcap. I do think there are a lot of gullible people who fall trap to these scams. I just wonder how we can avoid such a large number from being taken during these large scams

[milewilda]

I understand how people that are crypto native can have little sympathy for these sorts of instances but what about the people who really don't have much background knowledge of crypto?

It's precisely nothing to do with crypto. It's common sense. If a totally anonymous stranger is offering you guaranteed returns that sound ludicrously good then there is only one conclusion to make.

If all people do really have that kind of mindset then we are seeing less of these fraud things but sadly due to greed they do let themselves to be blinded and in result which is loss of funds.
That amount of Bitcoins is a typo yet we do only have 21M entire supply.lol

[jdarren]

Curious as to how these types of frauds will be handled by the court system. Will the stolen BTC become defunct and will that damage the rest of the overall system?