Ponzi scheme scammer uses BTC to cover tracks

[Bitstar_coin]

I really feel sorry for your friend for not stopping when he had the opportunity to do so. The first and second withdrawal was a golden opportunity to walk away with his money but greed has a way of taking over.
It is a bit surprising to know till now people still fall for ponzi scheme. No legit business will offer such a high %apy and able to survive.
Greed is a terrible thing and often result to a great loss. If he can get the right authorities involved, there is a high possibility their identity will be revealed and apprehended.

[Maidak]

I really feel sorry for your friend for not stopping when he had the opportunity to do so. The first and second withdrawal was a golden opportunity to walk away with his money but greed has a way of taking over.
It is a bit surprising to know till now people still fall for ponzi scheme. No legit business will offer such a high %apy and able to survive.
Greed is a terrible thing and often result to a great loss. If he can get the right authorities involved, there is a high possibility their identity will be revealed and apprehended.

Sometimes they are not lured into these scams but voluntarily participate because they cannot control their greed. Many people think that they will be smarter than others, meaning they will invest and will quickly withdraw before the project collapses but unfortunately when they join, they are blinded by profits until they really lose everything, then they remember their original purpose. It is not possible to give advice to such people, the only way is to let them experience and draw lessons for themselves, even though it will be the most expensive lesson they have ever learned.

[Ojima-ojo]

The ultimate question is, will law enforcement agencies do the work to arrest and persecute such scammer where we have CEO of exchange and other investment platform who file false bankruptcy order and walking away with investors, funds.

Not to mention how hard decentralization made is to discover the identity of wallet users and also if the scammer use Bitcoin mixing services it may become hard for the bitcoin to be trace.

Similar thing happens even in centralized banking system were their perform their scam-operating Ponzi scheme through the banking system and some time I can't stop but to wonder if scam collaboration exit between the bank, scammer, and law enforcement agencies.

[uneng]

Try tracking the bitcoin address your friend made the deposit, so you will find the final destination of the money. If the scammer uses mixing crypto services, there is still hope. You can denounce the website or app to the police and their intelligence service can track the origins of the site owner, IP and every other details which can lead to the real identity of the scammer.

If the ponzi has social medias and other kinds of advertisements it's better yet. Without any doubts he must have left a gap on any of his accounts that could help authorities to reach "the pharaoh".

[teosanru]

I work in healthcare and one of my patients offered an investment opportunity to me.
Leaving any amount of money higher than 100 bucks untouched for 9 months, would result in a 600% return on investment.
Of course this is fraud, but I had to figure it out. It is a pyramid system in which withdrawals of people at the top, are funded by money from new "investors" at the bottom of the pyramid. My patient had made 2 previous withdrawals with success ($2500 profit and $9000 profit), and has now invested $10 000 expecting 60 000 in a few months.

When no new money enters the system, the bottom line of the pyramid loses their money and the creator of the scam takes it all.
The scammer asks to get paid in BTC, not in fiat currency.

Can his BTC address somehow lead to an arrest?
Ponzi schemes don't last long. And historically these people are arrested because the source of the money is easily identified.
Now with BTC I think it is much harder to identify the scammer and to stop the scheme. I think it's harder for any government to prove that there is a Ponzi scheme in the first place

It's difficult but possible. I mean if it's a pyramid scheme then eventually the root account can be identified based on the first transaction made to that wallet and that wallet might have had some fiat withdrawal or some sort of deposit which would have had KYC. I mean it's difficult and is more like searching in the dark but it's not entirely impossible if you ask me. With sophisticated computers this shouldn't be a long task but yes if he erases his websites and user databases then it will become very tricky.

[panganib999]

I work in healthcare and one of my patients offered an investment opportunity to me.
Leaving any amount of money higher than 100 bucks untouched for 9 months, would result in a 600% return on investment.
Of course this is fraud, but I had to figure it out. It is a pyramid system in which withdrawals of people at the top, are funded by money from new "investors" at the bottom of the pyramid. My patient had made 2 previous withdrawals with success ($2500 profit and $9000 profit), and has now invested $10 000 expecting 60 000 in a few months.

When no new money enters the system, the bottom line of the pyramid loses their money and the creator of the scam takes it all.
The scammer asks to get paid in BTC, not in fiat currency.

Can his BTC address somehow lead to an arrest?
Ponzi schemes don't last long. And historically these people are arrested because the source of the money is easily identified.
Now with BTC I think it is much harder to identify the scammer and to stop the scheme. I think it's harder for any government to prove that there is a Ponzi scheme in the first place

Unfortunately through the manner at which he requests the tithings be made, there wouldn't be any forms of lead that would direct the authorities to him, so unless you personally know the perpetrator of this scam yourself, it would be a little too hard to hold them accountable in court due to the lack of evidence. Then again there are some instances of people outing themselves as the founder of a project in its infancy, then taking the money for themselves that are eventually caught or at least put in the wanted list of the police, sometimes by the InterPol even, that being said this happens very scarcely so don't get your hopes up. The case with bitcoin's anonymity is truly a double-edged sword. It helps people be obscured for stuff and purchases they don't want revealed, at the same time causing wrong-doers to commit crimes scot-free

[lionheart78]

Can his BTC address somehow lead to an arrest?

Yes, there are lots of cases where the owner of a Ponzi scheme is arrested even though they are under the guise of cryptocurrency.  As long as there is complain, and enough evidence of the fraud, the person can be arrested.

Founder of Fraudulent Cryptocurrency Charged in $2 Billion BitConnect Ponzi Scheme
Two arrested in massive $575m cryptocurrency 'Ponzi scheme'
SEC Charges Eleven Individuals in $300 Million Crypto Pyramid Scheme
Bitcoin Ponzi Operator Ordered Imprisoned for Civil Contempt

Now with BTC I think it is much harder to identify the scammer and to stop the scheme. I think it's harder for any government to prove that there is a Ponzi scheme in the first place

In fact, it is easier because Bitcoin blockchain is transparent and the transaction link can be viewed publicly.

[KingsDen]

...Most often, why these Ponzi admins go Scott free is because some people profited on the initial stage. Like your patient whose profits is around $9000 she won't have the guts to chase after the admins when they're gone, same with other victims.

You know too well how the system works and sadly I have been a victim of this which crippled my first attempt of financial breakthrough. When the ponzi scheme fails, the people at the top of the pyramid must have benefited enough such that they wouldn't have the guts to purse the course and eventually the founder is caught, they would also be indicted. They will have no option than to hide in shame and enjoy their money in secret.

Some who are heartless will come back to console you and use the opportunity to introduce you to another ponzi scheme where they already occupied the bottom slots and you will come and deposit money which will be used to pay them as well.

[Solosanz]

It depends on how good the scammer to use Bitcoin without any trace and remain 100% anonymous. Bitcoin is pseudonymous where anyone can know the address, but they can't know who's the person who control that's address. If he's not run full node, there's a chance his IP address would be leaked since he's use someone server to connect his wallet. Or if he use centralized exchange and have submitted his KYC, he can be easily get frozen when someone report that address is from a scammer.

[Vlad1977]

Bitcoin is characterized by anonymity. So many people think of scamming with Bitcoin. But Bitcoin also has the advantage of being open and transparent. We can see all transactions on the chain.
Don't blindly trust other people's words in all investments. Do your research before any investment. Use your own judgment.

[DapanasFruit]

Of course, scammers are using any available means in order to lessen the chance of getting into the court and to serve the time for the crime committed...and we have to remember that this is the case even if cryptocurrency has never came into the scene. Now, we already have some good technologies and mechanisms that can track people - the scammers - even if they are using Bitcoin. What can be harder is recovering the funds - again this is also true if the scammer can be using the fiat system - but for proving the fraud all one has to do is work for the victims because I am sure there can be records of transactions with the scammers and this can be a good advise for all to make sure  that documentation is always ready.

[gunhell16]

I work in healthcare and one of my patients offered an investment opportunity to me.
Leaving any amount of money higher than 100 bucks untouched for 9 months, would result in a 600% return on investment.
Of course this is fraud, but I had to figure it out. It is a pyramid system in which withdrawals of people at the top, are funded by money from new "investors" at the bottom of the pyramid. My patient had made 2 previous withdrawals with success ($2500 profit and $9000 profit), and has now invested $10 000 expecting 60 000 in a few months.

When no new money enters the system, the bottom line of the pyramid loses their money and the creator of the scam takes it all.
The scammer asks to get paid in BTC, not in fiat currency.

Can his BTC address somehow lead to an arrest?
Ponzi schemes don't last long. And historically these people are arrested because the source of the money is easily identified.
Now with BTC I think it is much harder to identify the scammer and to stop the scheme. I think it's harder for any government to prove that there is a Ponzi scheme in the first place

That's how the Ponzi scheme is designed, you can only make money there if you're the one at the top, and those at the bottom are the ones who get in. Because what is paid to the early investors will also come from the last to enter that style. And with my knowledge of traditional Ponzi schemes, I have heard of many people being caught and imprisoned for scamming people.

Now, if the scammer's request is through Bitcoin, this is a big question for me right away. After all, it is certain that the address he will give is his bitcoin address and of course, he will not admit that it is his but will issue it to the bitcoin address of the company, because they will remain anonymous this way and it will be difficult to be traced by the concerned government agency.

[cheezcarls]

I work in healthcare and one of my patients offered an investment opportunity to me.
Leaving any amount of money higher than 100 bucks untouched for 9 months, would result in a 600% return on investment.
Of course this is fraud, but I had to figure it out. It is a pyramid system in which withdrawals of people at the top, are funded by money from new "investors" at the bottom of the pyramid. My patient had made 2 previous withdrawals with success ($2500 profit and $9000 profit), and has now invested $10 000 expecting 60 000 in a few months.

When no new money enters the system, the bottom line of the pyramid loses their money and the creator of the scam takes it all.
The scammer asks to get paid in BTC, not in fiat currency.

Can his BTC address somehow lead to an arrest?
Ponzi schemes don't last long. And historically these people are arrested because the source of the money is easily identified.
Now with BTC I think it is much harder to identify the scammer and to stop the scheme. I think it's harder for any government to prove that there is a Ponzi scheme in the first place

Typical ponzi because of the word “promised” and “guaranteed” in returns. If you are one of the early birds, you would get lucky to exit with profit as long there are other ones after you.

It’s a gamble but others who are way behind are gonna be left out and not going to recover their investments.

This is where blockchain comes in that would trace your transactions that is immutable no matter where it goes. Plus, they are in public where everyone can view without the need to login.

[joeperry]

Can his BTC address somehow lead to an arrest?
Ponzi schemes don't last long. And historically these people are arrested because the source of the money is easily identified.
Now with BTC I think it is much harder to identify the scammer and to stop the scheme. I think it's harder for any government to prove that there is a Ponzi scheme in the first place

If the investigators or police really tracked him down, there will be a point that he needs to use a legal service to withdraw a big amount and that could lead to his arrest but there's a lot of ways now to cover tracks such as using a mixing service, coinjoin, selling Bitcoin to buy anonymous coins such as Monero and Zcash then use it to trade in P2p. If I can remember only few were arrested but not all.

[Reid]

When no new money enters the system, the bottom line of the pyramid loses their money and the creator of the scam takes it all.
The scammer asks to get paid in BTC, not in fiat currency.

Can his BTC address somehow lead to an arrest?

Does this mean they really know the owner of the scheme, because it's just a sudden change of payment option.
That means he can run but he cannot hide anymore if his identity was already known from the start where the member are paying fiat.

Ponzi schemes don't last long. And historically these people are arrested because the source of the money is easily identified.
Now with BTC I think it is much harder to identify the scammer and to stop the scheme. I think it's harder for any government to prove that there is a Ponzi scheme in the first place

It is. But there are always ways to track them. It's not like Bitcoin is pure anonymous. Somehow, that address will try to send it to someone, mix it, or send to an exchange to make it to cash. Or, if ever he tries to use BTC directly, it can still be traced.

[Simplycallmecollins]

I had similar experience not long ago and I made a post about it.
These fraudsters are intentional about their payment method because it become really difficult (not impossible) to track them, unlike a regular bank account where your information are stored in their database and the government are able to get access to them.
Also, I should mention that some of the people who engage in this ponzi schemes are aware they would get defrauded, but they just hope the platform doesn't crash as soon as they join and hopefully make some money.
However, like I was advised, when there's such "investment opportunity" make good research, and if the reward is too good to be true, that is little efforts with huge return, it's most likely a scam.

[WeThePe0ple]

There is a lot of such fraud in my country, but a very important point for a new participant to receive money is to attract new investors to this financial pyramid. If you do not bring new participants, then the organizers of the financial pyramid will not allow you to withdraw a lot of money. Therefore, the participants of the financial paramid are actively engaged in attracting new participants.

This makes sense. I was not aware of this. I thought that it did not matter who brings the new participants. I have noticed that my friend is actively searching for new participants. By making accounts for her children, by contacting me and God knows how many others. And I have informed her about the scam but she does not want to believe it.

I do hope that for her children, she is not using much of her own money to get started. I just informed her about your post, but I have the impression that she does not want to hear it and is even getting pissed off at me for not letting it go. Clearly she will remain in the pyramid.
Same thing for her husband, who is also a patient of mine.

Typical ponzi because of the word “promised” and “guaranteed” in returns. If you are one of the early birds, you would get lucky to exit with profit as long there are other ones after you.

But if you are in it for $10 000 and you get two guys to join for 100 bucks, I don't think the scammer will allow your withdrawal.
You could grow your bankroll to 10k, send a message to "customer service" saying that you would like to test the withdrawal and then get 2 family members in for 10k each (which of course you will not do)

But if he believes you and lets you withdraw, you can scam the scammer.
However, the withdrawn money is from victims. If they ever try to claim it back, and it is in the bank account of someone higher up in the pyramid, the victims may be charged as criminals. After all, the scammer has printscreens of their passports.

[moderator's note: consecutive posts merged]

[CryptSafe]

Scammers of lately have mapped out so many means of scamming people of their hard earned resources be it fiat Bitcoin and other Crypto currencies. The truth it that most of their victims do know for sure and just like the other poster before me said that "they do know but for the fact that they do benefit from the scheme, they find it difficulty to report as they make huge profits from it."
 
Like I will always say there is nothing hidden under the sun, there is no crime schemes that can not be investigated as long as that wallet holding that ill gotten assets is doing transactions, the owner can be apprehended by the security agencies if they swung into actions. It is not a difficult one and it is no difference from what they agencies have been doing for long now but all it takes is just reporting the issue to them and watch them act.

[Lucius]

This makes sense. I was not aware of this. I thought that it did not matter who brings the new participants. I have noticed that my friend is actively searching for new participants. By making accounts for her children, by contacting me and God knows how many others. And I have informed her about the scam but she does not want to believe it.

You have some strange patients, who even involve their own children in something illegal - an honest citizen would report it to the police, anonymously of course. They know very well what it is about, the fact that they are persistent only proves that they are at the top of the pyramid and want to draw as many people into their network as possible.

By the way, did you read my previous post? For someone who is a doctor, you should pay a little more attention to well-intentioned advice.

[WeThePe0ple]

By the way, did you read my previous post? For someone who is a doctor, you should pay a little more attention to well-intentioned advice.

I just did.

The thing is that they are not convinced it is a Ponzi scheme in the first place. They do not believe it is illegal. I tried to make the scheme clear and they showed me powerpoint presentations of "investment projects" from the scammer. It seems to me that the people in the pyramid are not the brightest minds in society. I've spoken to 3 of them and I immediately noticed that. I ask them questions like "If this was genuine, why are the richest people in society not involved in this?" and "If they make so much money, why do they need money from others?". And then they freeze, but hold on to the pyramid anyway.

A more intelligent person would do some research and figure it out. These people can't even figure it out when someone else does the work for them.
They have had 2 successful withdrawals and they are hoping that this will make them rich.

Both patients have told me about 2 Dutch women who are actively drawing as many people as possible to the scheme.
I think the first move is probably to report these women to the police. They are high up in the pyramid and they must know what is going on