The most recent European Union sanctions against the Kremlin prohibit Eurozone operators from engaging with crypto asset providers that facilitate transactions supporting Russia’s defence-industrial base. Additionally, the new sanctions regime forbids Eurozone operators from utilizing the Russian-developed System for Transfer of Financial Messages (SPFS). These restrictive measures also focus on tankers associated with “Putin’s dark […]
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Malaysian Authorities Bust Syndicate Accused of Laundering Fraud Proceeds via Cryptocurrency
Law enforcement officials in Malaysia recently arrested ten individuals linked to a criminal syndicate that allegedly used cryptocurrencies to launder fraudulent proceeds. Assets, including motor vehicles, valued at more than .7 million were seized, and bank accounts holding approximately .8 million were frozen. Syndicate Accused of Channeling Illegally Acquired Funds into Malaysia Authorities in Malaysia […]
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Built On An $6 Million NFT Scam? AI Company Accused Of Fraud By Internet Investigator
Youtuber and Internet investigator Coffeezilla has called out Artificial Intelligence (AI) company Rabbit for allegedly being built on a million non-fungible token (NFT) scam. The company is accused of being responsible for the GAMA NFT Project “fraud” as part of a history of lies.
Down The NFT Fraud Rabbit Hole
Stephen Findeisen, better known as Coffeezilla, published a YouTube video calling out Rabbit Inc. for being built on the remains of an alleged NFT fraud from 2021. The internet investigator revealed that the company is seemingly trying to hide its ties to the GAMA project.
Coffeezilla unveiled the depth of the AI company’s rabbit hole by claiming that, despite raising over million in venture capital (VC), Rabbit used to be called Cyber Manufacture Corporation.
In 2021, the company raised over million for its “next-generation NFT Project GAMA.” The project was described as a decentralized organization “with the grand goal of sending 10,000 astronauts into space to collect extraterrestrial energy.”
At the time, GAMA’s founder Jesse Lyu would make “wild promises,” claiming the NFTs were just the start. According to the YouTube sleuth, Lyu declared they would create “the first-ever carbon-negative cryptocurrency powered by our sun.”
The founder promised to build a clean energy grid through NFT sales owned by NFT buyers. The grid’s energy would be used to mine GAMA tokens. However, the tokens were never launched, and the project seemed to be abandoned.
Its team replied to Coffeezilla’s request for comment, stating that GAMA was not abandoned but “open-sourced.” Moreover, they claimed a token was never promised, as Lyu said in 2021 that his words were not final. The team added that they live in a country that “values free speech.”
Nonetheless, the internet investigator found that the “open-sourced” engine constantly crashed and was non-functional after several tests. He also highlighted that Lyu stated in several discord messages that the project’s cryptocurrency was part of the roadmap.
Based on this, Coffeezilla questioned where the million in funding went and whether Lyu’s new project should be trusted.
Another Rabbit In The Hat?
GAMA’s founder has embarked on a new project unrelated to NFTs. His latest company, Rabbit, focuses on AI technology. The company went viral in early 2024, raising million in VC and selling over million in consumer products.
Rabbit launched their AI personal assistance device, Rabbit R1, on easter 2024. However, the project has received a lot of backlash for not living up to the hype and promises.
Several tech reviewers concurred that R1 was part of a trend of releasing “unfinished” products. According to YouTuber Marques Brownlee, Rabbit’s product was “barely reviewable” and the pinnacle of “delivering barely finished products to win a race.’”
Moreover, founder and CTO of WeGPT, Josh Ollin, called the project a “scam” when R1 was announced. He also pointed out on different occasions that the hype and interactions around the company were “fake impressions” from bots.
Ollin called Lyu an “NFT grifter” and stated that his past behavior affected the new project due to the “shady insincere fraudulent business practices on display (fake engagement, fake bot followers, fake tech stack, overpriced vaporware).”
Coffeezilla stated a similar sentiment in his video:
So many of the promises of Gama didn’t happen. This is relevant to the R1 not just because this project is built on the skeleton of that scam project, it’s also because the R1 is overhyped in a similar way.
As noted by the internet sleuth, Lyu has diminished his links to GAMA NFT, calling it a “fun little project” he was “involved with” during the COVID-19 pandemic.
Ultimately, he considers it important for users to know the company’s “history of abandoning investors like they did with GAMA NFT.”
Nigeria Detains Two Binance Executives, Crypto Platform Accused of Exchange Rate Manipulation
Nigerian authorities have reportedly detained two senior executives from Binance who had recently arrived in the country. The Central Bank of Nigeria’s governor stated that in 2023 alone, billion flowed through the cryptocurrency exchange from sources and users that the bank could not adequately identify. Passports of Binance Executives Seized Authorities in Nigeria have […]
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Deltec Bank Accused of Secretly Extending a $2 Billion Credit Line to Alameda Research
Deltec Bank and Trust Ltd, based in The Bahamas, stands accused of covertly extending a billion line of credit to Alameda Research. A lawsuit, filed by those who claim to be victims of Sam Bankman-Fried, accused Deltec of granting a three-day grace period to Alameda Research for the settlement of purchased stablecoins. Misappropriation of […]
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Woman Accused of Laundering Bitcoins for Chinese Fraudster Goes on Trial in the UK
A British citizen recently went on trial in the U.K. for laundering bitcoins on behalf of a fugitive Chinese fraudster, Yadi Zhang. Prosecutors insist that Jian Wen was aware that Zhang’s bitcoins were acquired using stolen funds. However, Wen defended her actions and said she thought Zhang had accumulated her wealth through her jewelry business, property portfolio, and bitcoin mining operation.
Zhang’s Wealth Management Business
A British-Chinese woman, Jian Wen, is on trial in the U.K. for allegedly laundering bitcoins that were sourced with .3 billion stolen from more than 128,000 investors in China. According to prosecutors, Wen is facing three charges of laundering money on behalf of the Chinese national Yadi Zhang.
Zhang, a fugitive from justice, is said to have perpetrated the grand fraud via her bogus wealth management business between 2014 and 2017. Afterwards, she reportedly converted some of the stolen money to bitcoin (BTC) before leaving for London under a false identity.
Upon arriving in the U.K., Zhang sought the services of Wen to convert her BTC into cash, jewellery, and other luxury items. The Crown Prosecution Service (CPS) alleges that Zhang’s ultimate objective was “to disguise the true source of the funds.”
During the trial, Gillian Jones, who represented the CPS, stated that while Wen was not involved in the fraud, she may have known that Zhang’s bitcoins were proceeds from criminal activity. Jones urged the jury to ask Wen if she was aware of Zhang’s criminal activities.
The lawyer argued that Wen, a naturalized British citizen, knowingly acted as a front for Zhang and was probably paid for it. However, Wen defended her actions and said she thought Zhang had accumulated her wealth through her jewellery business, property portfolio, and bitcoin mining operation.
The trial is expected to run until early March, according to the report.
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Estonian Government Approves Extradition of Crypto-Fraud Accused Duo to the US, Again
The Estonian government has once again approved the extradition of the two alleged masterminds behind the Hashflare crypto mining Ponzi scheme to the United States. According to a local news report, the government has met the conditions for the men’s extradition set by the Tallinn Circuit Court.
The Estonian Ministry of Justice Has Collected Sufficient Evidence as Demanded by the Court
The Estonian government has approved the extradition of two founders of the crypto mining platform Hashflare, who are accused of operating a Ponzi scheme that fleeced 5 million from unsuspecting investors.
Ivan Turogin and Sergei Potapenko were arrested in Estonia’s capital Tallinn in November 2022, in a joint operation by the Estonian police and the U.S. Federal Bureau of Investigations (FBI). They face 18 counts of fraud and money laundering charges.
According to a Post Timees report, Tallinn Circuit Court initially blocked the attempt to extradite the duo because the Estonian government had failed to probe the conditions of the place where Turogin and Potapenko were to be held, among other things. However, the Estonian government through the Ministry of Justice has said it has gathered enough evidence as per the court ruling.
The Estonian government now believes it has satisfied the conditions set by the court, and the men’s extradition to the U.S. would be above board. Described as one of Estonia’s high-profile fraud cases, Turogin and Potapenko’s Ponzi scheme reportedly took money from hundreds of thousands of Estonian and non-Estonian investors who were promised high returns on their investments.
After their arrest, a U.S. attorney suggested that Turogin and Potapenko had used the allure of cryptocurrency mining to dupe people into investing.
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Denver Pastor Accused of Misappropriating $1.3 Million Raised via a Crypto Token Sale
The Colorado Securities regulator has accused the pastor of an online-only church of illegally pocketing .3 million which was raised via the sale of a cryptocurrency he created. A judge in Colorado has since ordered the closure of the pastor and his wife’s bank accounts for 14 days.
‘The Lord Brought This Cryptocurrency to Me’
The securities regulator in Colorado has charged Reverend Eli Regalado, creator of the cryptocurrency INDX coin and pastor of the online-only Victorious Grace Church, with selling “worthless” INDX coins for .4 million sometime in 2022 and during the first half of 2023. Tung Chan, Colorado’s securities commissioner, filed a lawsuit on Jan. 16, accusing Regalado of ensuring that investors in his coin did not recoup their investment.
According to a report by the Denver Post, Regalado pocketed .3 million from the token sales, which he spent on a Range Rover, jewelry, luxury handbags, cosmetic dentistry, and boat rentals.
The lawsuit suggests that Regalado used his position as a religious leader to convince his followers to invest in cryptocurrency. For instance, in one sermon on Aug. 22, 2022, Regalado told his followers that his lord had instructed him to create the now-defunct crypto asset.
“It was last October that the Lord brought this cryptocurrency to me. He said, ‘Take this to my people for a wealth transfer.’ It has been confirmed a hundred times since,” Regalado reportedly said.
INDX Coins ‘Technologically Deficient’
Additionally, in what may have been an attempt to dissuade investors from offloading their holdings, Regalado claimed that the Lord had asked his followers to “stay in INDX coins.”
However, in her lawsuit, Chan accused Regalado and his wife Kaitlyn Regalado of falsely claiming that the INDX coins were worth at least each or 0 million for the 30 million coins. Chan also described the cryptocurrency and the only marketplace where INDX coins were traded as being “catastrophically technologically deficient.”
Following the filing of the lawsuit, U.S. Judge David Goldberg ordered the Regalados’ bank accounts and those of associated companies to be closed for 14 days. Additionally, the judge prohibited the Regalados from selling securities in Colorado.
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Pastor Accused Of Defrauding Congregation With $3 Million Crypto Ponzi Scheme
Denver-based internet pastor, Eli Regalado, is at the center of a controversy surrounding an alleged crypto Ponzi scheme involving INDX coin.
The self-proclaimed spiritual leader has come under scrutiny as Colorado’s securities regulator investigates his deceptive practices, which reportedly resulted in over million in ill-gotten gains. Fortune magazine report shed light on the matter, exposing Regalado’s questionable actions and shedding light on the plight of the victims involved.
Pastor Regalado’s Deceptive Crypto Venture
According to Colorado’s securities regulator, Regalado, and his wife orchestrated a “small-scale swindle”, targeting hundreds of individuals with promises of extraordinary returns on their investments in INDX coin.
Presenting his appeals with biblical undertones, using terms like “sowing” and “tithing,” Regalado convinced his online church followers that purchasing the cryptocurrency would yield a tenfold increase in their investments.
However, the promised returns never materialized, and investors lost their “hard-earned” money. To compound matters, it is alleged that the Regalados diverted a significant portion of the funds to finance personal expenses, including home renovations and luxury purchases, further exacerbating the victims’ financial losses.
Despite the allegations and mounting legal troubles, Regalado chose to address the accusations head-on by posting a 10-minute video on the crypto project’s website.
In the video, he attempts to deflect responsibility, claiming that misappropriating funds was not solely his decision, but rather a result of divine guidance for a home remodeling project.
Displaying a lack of understanding of financial concepts, Regalado haphazardly employs buzzwords like “leverage” and “liquidity” without demonstrating a clear comprehension of their meaning.
Furthermore, Regalado boasts about the supposed success of the project, mentioning “0 million of coins sown before the exchange went live.” However, the Colorado regulator clarifies that these coins have no value, primarily because they could only be traded on the Kingdom Wealth Exchange, an ill-functioning service operated by the Regalados themselves.
Colorado Authorities Take Action To Recover Funds
According to Fortune, the next steps in this ongoing investigation are expected to involve the state of Colorado seizing any remaining funds and returning them to the defrauded investors.
Meanwhile, Regalado’s video attempts to invoke divine intervention, predicting that the INDX coin debacle will resolve itself miraculously through divine intervention in the financial sector.
According to CoinGecko data, the total crypto market cap has declined over 4.6%, reaching as low as .51 trillion on Monday. However, when compared to one year ago, the cryptocurrency market has witnessed an impressive surge of 55.27%.
At the forefront of the cryptocurrency market stands Bitcoin (BTC), the pioneering digital currency that continues to dominate the landscape. As of today, Bitcoin’s market cap stands at an impressive 5 billion, accounting for a substantial 47.66% of the total cryptocurrency market.
Featured image from Shutterstock, chart from TradingView.com
Report: Taiwan Police Arrest Crypto Exchange Bosses Accused of Fraud
The police in Taiwan recently arrested two individuals who are accused of deceiving 100 investors into buying fake virtual currencies. The police also apprehended 14 other participants in the fraud scheme and recovered more than million in both cash and virtual currencies.
Worthless Virtual Currencies
Taiwanese police recently arrested two executives of what has been described as one of the region’s largest cryptocurrency exchanges, ACE Exchange. The arrests followed an investigation which concluded that the duo had helped trick 100 individuals into buying “worthless virtual currencies.”
According to a Liberty Times Net report, Lin Nan, one of the executives, used the promise of quick riches to lure unsuspecting people into investing. Lin Nan’s alleged accomplice, Pan Nan, reportedly listed the fake virtual currencies on ACE to boost their credibility. The duo was able to perpetrate the scam for three years before law enforcement agencies caught up.
In addition to arresting the duo, police also apprehended 14 individuals at 15 locations spread across Taipei, New Taipei, and Taichung. A raid on Lin Nan’s residence saw the police recover more than .6 million (111.52 million yuan) in cash and virtual currency worth just over .4 million. The Taiwanese police estimate the total value losses associated with Lin Nan and Pan Nan’s fraud scheme at over million.
After their interrogations, Lin Nan, Pan Nan, and the 14 other individuals were taken into custody. They are set to be charged under the region’s Criminal Code, the Money Laundering Prevention Act, and the Banking Act.
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