Category: Scams

Categories
Bitcoin Scams

Instagram Influencer Scams Followers out of 2.5 Million in Bitcoin Scheme

There crypto-scam occurred this month, but this time it did not involve a shady project that ran away with investors’ funds, rather an Instagram influencer who scammed his followers out of $ 2.5 million through a Bitcoin scheme.

Jebara Igbara went by the name of Jay Mazini on its Instagram, known for buying Bitcoin using his account. Igbara used his 1 million followers to make a profit of 2.5 million through a Bitcoin scheme, by tricking followers to send him Bitcoin to his wallet in exchange for fiat, but never paid.

Igbara Could Face More Than 20 Years in Jail

His followers filed a complaint to the Brooklyn Federal Court. One user sent Igbara over 5000 BTC on January 7, which is now worth over AU$ 340 million, never paying back. The U.S. Department of Justice is now charging Igbara with wire fraud, which could give him a sentence of up to 20 years in jail.

“As we allege, Igbara’s social media persona served as a backdrop for enticing victims to sell him their Bitcoin at attractive, but inflated, values. A behind-the-scenes look, however, revealed things aren’t always as they seem. There was nothing philanthropic about the Bitcoin transactions Igbara engaged in with his victims.”

—stated FBI Assistant Director-in-Charge William Sweeney [on the court document]. 

Igbara is now detained in New York, waiting for his trial. His Instagram account was deleted on Thursday.

Another scam worth noting is TurtleDex, a so-called “DeFi storage protocol” that performed an exit scam on its users, scamming its investors out of the same amount as Igbara. $2.5 million were drained out liquidity pools, and communications channels, including TurtleDex’ official website were deleted afterwards.

Categories
Binance Crypto News Scams

TurtleDex Pulls a $2.5 Million Exit Scam on Binance Smart Chain

Approximately $2.5 million in Binance Coin (BNB) was drained from trading pools in the Binance Smart Chain DeFi exchanges after the anticipated launch of TurtleDex.

TurtleDex advertised itself as a DeFi storage platform and claimed it could help “keep data and preserve files without needing to keep them on their computer”. With the pre-sale launch on 15 March, the team hit their target in two hours, raising approximately 9000 BNB.

After the fundraising round, the funds were drained from the TurtleDex liquidity pool, moved to PancakeSwap and ApeSwap exchanges. From there, the funds were converted to Ethereum (ETH) and sent to nine separate wallets on the Binance Exchange.

TurtleDex (TTDX) Holders Seeking Intervention

This type of scam is called exit scam, also known as “rug pull”. Shortly after it occurred, the owners deleted TurtleDex’s Telegram, official website, Twitter profile, and other social pages.

TurtleDex Twitter page

Distressed investors looked toward Binance for assistance and have reached out to CEO Changpeng Zhao (CZ). They will need to keep their fingers crossed that Binance will step in and freeze the funds that were sent to Binance wallets.

Although with no formal response as of yet, investors will need to hope that CZ makes good on his word to assist with recovering funds lost in rug pulls based on a comment made a few days prior to the incident.

High Risk In The DeFi Space

The community is up in arms about the event and is questioning the effectiveness of contract-audits since this is not the first exit scam to hit Binance Smart Chain.

This is the third upset on BSC DeFi exchanges this month.

  • 5 March: farming protocol Meerkat Finance stole over $30 million worth of crypto-assets – 13.96 million in BUSD and over 73,000 BNB.
  • 9 March: hackers took US$3.8 million worth of crypto from DeFi platform Dodo.

Binance has cautioned investors to DYOR (Do-Your-Own-Research) and be wary when investing in the new and growing DeFi space.

Categories
Blockchain NFTs Scams

Guggenheim Museum Looking For NFT-Read Intern

The Guggenheim art museum is one of the world’s top repositories of art — and according to new MBA internship opportunities, they may be looking to add some NFTs to their collection. 

Looking To Get In On The Action

Applicants to the internship in question will have to work on the “evaluation of non-fungible token (NFT) based art, a nascent, fast-growing, highly scalable area of the art world.”

They will have to define how blockchain may change the way a museum defines its collection strategy — and more precisely, in what ways should the Guggenheim become a digital experience, alongside more traditional art forms such as paintings.

Just yesterday, a piece of virtual real estate created by artist Christa KIM as an NFT was sold for $500,000. Not to mention the Beeple NFT that sold for over $6 million worth of ETH. 

 Now, the Guggenheim seems to be looking to get in on the action and snap up a few of these NFTs themselves. 

NFTs have soared in popularity within the past month or so —  and generated quite a bit of controversy in the process. While many say that the so-called NFT gold rush is purely a result of the ever-changing nature of art. Others say that they are a fad that will soon pass. 

NFT scams have also started popping up —  for instance, artist Derek Laufman has had his art stolen and made into NFTs without his permission.

 “I was basically kind of annoyed that somebody had, quote, unquote, verified me as on that platform. I dealt with having my art stolen for years. And I’m sort of numb to that. But when somebody is claiming to be you … that kind of, you know, pisses me off.”

But whether NFT should stand for Non-Fungible Token or New-Fangled Token, the past has shown that widespread adoption of crypto assets by well-established companies has only made their value increase – and names like Guggenheim, Sotheby and Christie’s tend to carry weight in the art world.

Categories
Bitcoin Crypto News Scams Worldwide

Man Loses $700,000 in Fake Elon Musk Crypto Scam

A man from Germany has fallen victim to a Bitcoin scam, losing over AU$700,000 to a fake Elon Musk giveaway.

Sebastian (not his real name) said that Elon Musk, CEO of Tesla, tweeted, “Dojo 4 Doge” and was curious about what he meant as Musk often tweets about crypto. Apparently, under the tweet, there was a link to an event that was giving away Bitcoin, which Sebastian clicked on.

Seemingly run by Musk’s Tesla team, the so-called giveaway invited people to send anything from 0.1 Bitcoin (AU$7,700) to 20 Bitcoin (AU$1.5 million) with the promise of sending back double the amount, reports the UK’s BBC News. A common impersonation scam which we’ve covered in our Bitcoin Scams Guide.

“It Was a Big Fake”

Believing he was on to a good thing, Sebastian sent 10 Bitcoin, amounting to over AU$700,000. For the next 20 minutes, Sebastian waited for his Bitcoin wallet’s value to increase.

It was only after the countdown ended that Sebastian realized he’d been scammed. He said:

I realized then that it was a big fake. I threw my head on to the sofa cushions and my heart was beating so hard. I thought I’d just thrown away the gamechanger for my family, my early retirement fund and all the upcoming holidays with my kids.

Even though he tried to get his money back, he finally accepted he wasn’t going to see it again.

Crypto Scams Soar

In recent years, crypto scams have risen targeting unsuspecting people with false promises that they can earn more if they just give a little. According to data from Chainalysis, scams made up the majority of all crypto-related criminal activity at 54%, in 2020, representing AU$3.35 billion.

Value received by illicit services monthly 2020 [source: Chainalysis]

Fake crypto giveaways are also gaining traction and often target high-profile pages in the hopes that they will trick people into thinking it’s real. They either achieve this by disguising the account to look like the real one or hacking into the account. Musk is one figure who has been used before.

However, it was in 2020 when hackers managed to steal AU$153,000 after a short-lived hack enabled them to tweet from celebrity accounts, including Bill Gates and Kim Kardashian-West.

Unfortunately, with interest in crypto continuing to rise amid increasing prices, crypto scams are going to remain. Speaking on this, Whale Alert founder Frank van Weert, said:

When the Bitcoin price goes up, people go crazy and a lot of them are new to the market and they want this idea of quick money.

Categories
Cryptocurrencies Ethereum Scams

Roll Wallet Hacked, Social Tokens Plummet

On Sunday, Roll Wallet was hacked which sent the value of social tokens plummeting all the way down to the bottom.

Down By More Than 50%

Social tokens are a type of cryptocurrency designed specifically to support online communities. A number of these are in a race to the bottom following a hack on Roll Wallet. Most notable among them – due to the current NFT frenzy – is WHALE. WHALE is a social coin whose value is maintained by a basket of Non Fungible Tokens (NFTs). Other coins that have plummeted are PICA and RARE.

The hack was confirmed on Twitter by the founder of WHALE, who confirmed that 2.17% of all tokens were compromised in an attack on the platform’s hot wallet. However, the remaining assets are secure, having been stored in cold wallets.

The founder went on to say that he is confident that this attack will not have far-reaching effects on the cryptocurrency and its future.

“We were fortunate that this hack was minimally detrimental to the project despite the large price volatility (due to the level of liquidity on Uniswap) and will find a way to absorb this so it has zero impact on our short, mid and long term growth of $WHALE.”

However, as the following chart shows, recovery – if there is one – may take a while.

On the other hand, competitor token RLY – a token launched by the Rally platform – has reached its highest value in history.

Meanwhile, MyCrypto reports that the attacker who pulled off this digital heist is already cashing out to Tornado Cash – with the total amount of ETH reaching nearly 2600. It also looks like social tokens were minted by malicious parties before the attack, hinting at a possibly high-level manipulation of the network.

Categories
Australia Cryptocurrencies Scams

More Arrests In Crypto Laundering Case

Following the arrest about 2 weeks ago of a 30 year old man in Sydney for allegedly laundering money through cryptocurrency, a series of arrests have been carried out by the New South Wales Police force. The man in question has since been charged with a total of 24 offences, pending a court date on the 19th of April.

Out of these 24 charges, 19 of them are for “knowingly dealing with the proceeds of crime, knowingly directing activities of a criminal group and drug-related offences.”

Police will allege in court that the suspect arrested last month directed a criminal syndicate to launder money by converting cash into bitcoin on his behalf, totalling $5,479,300.”

6 More Suspects Charged

Following new developments in the investigation that’s been going on since October – when the police first started looking into the alleged money laundering syndicate – 6 more arrests were carried out in rapid succession.

The raids were carried out by the Cybercrime squad  in the greater Sydney area. The raids resulted in the seizure of electronic devices, high-end jewelry , and cash.

Three of the suspects – women from the Homebush West, Newington, and Denham Court areas are facing less serious charges, namely “recklessly dealing with the proceeds of crime”.

However, the other 3 are facing far more serious charges. Among them, a 48-year-old man was charged with “participating in a criminal group contributing to criminal activity, as well as seven counts of knowingly dealing with proceeds of crime with intent to conceal.”

Another suspect – a 24-year old woman – was charged with 4 counts of “knowingly dealing with the proceeds of crime”, as well as contributing to criminal group activity.

As of today, no preliminary court dates for the alleged suspects have been set.

Categories
Australia Blockchain Cryptocurrencies New Zealand Scams

Qoin Going For New Zealand Market Following Controversy With Blockchain Australia

Qoin is reportedly making a marketing push in New Zealand, following it’s rather sudden removal from Blockchain Australia.

Apparently, the reason for the removal from Blockchain Australia is the lack of transparency regarding the companies dealings, and the very limited ways you can cash out. This is due to the fact that the BPS Financial Limited company in is control of QOIN, and also owns the only crypto exchange where it can be traded, namely Block Chain Trade Exchange.

Discussions Over Legitimacy Ongoing

BlockchainNZ has stated they are looking into Qoin and the accuracy of complaints levelled against it – as well as the reasons why it may or may not be a scam.

Stephen Macaskill – an executive member of BlockchainNZ – stated that although they are not endorsing Qoin, they will be looking into the matter before giving their verdict. He also added that in his opinion, Qoin was not necessarily illegitimate, and that the view that it is may stem from the fact that unlike most cryptocurrencies it is not open source or decentralized. However, they are by no means the first nor the last crypto-related firm to stray from the transparent model.

“We’re not endorsing this business by any means, but there’s an international exchange that has their own digital asset and initially when they launched you could only buy their own digital asset on their own exchange, and there are a few of them out there like that. Over time those assets were listed on other trading platforms.”

Stephen Macaskill – an executive member of BlockchainNZ 

Macaskill also added that building a new cryptocurrency from scratch took a lot of work, and it takes a while for any new token to be listed on other trading platforms – a potential reason for the seemingly closed-circuit model adopted by Qoin.

Whether Qoin takes root in New Zealand or is eyed suspiciously there as well will be something to watch for, as this could set a precedent for other companies who take a rather unorthodox approach to cryptocurrencies.

Categories
Australia Scams

AUSTRAC and ASIC Investigating Scammers Deceiving Aussie Crypto Investors

A new investigation by the Australian Financial Review has shown that millions of dollars in cryptos are being stolen by British scammers posing as crypto exchanges in Australia.

These scammers not only are disguising themselves as exchanges but also faking identities of financial corporations and Australian investment management companies, offering high-yield bonds.

Some of the alleged stolen identities are:

  • Citibank
  • Nomura
  • IFM Investors
  • Binance
  • Coinbase

According to the investigation, The AUSTRAC (Australian Transaction Reports and Analysis Centre) and the ASIC (Australian Securities and Investments Commission) will work together to track down these scammers.

Scammers Posing as Binance Australia and Coinbase

Not only scammers have been stealing and posing as major financial institutions, but also taking the same web infrastructure of several crypto exchanges.

These scammers have also been exploiting the potential reach of several search engines, appearing in the main pages of Google as top crypto exchanges.

Back in February, Jeff Yew, CEO of Binance Australia, warned people on Twitter over misleading emails all over the country.

Following his post, another user reply by uploading an image of SMSs with “Withdrawal codes” sent to him by “Coinbase”.

Australians should be careful when receiving emails and SMSs claiming to be crypto exchanges or investment funds. You can check out Crypto News Australia’s guide on how to stay safe in crypto and avoid wallet frauds.

Categories
Cryptocurrencies Cryptocurrency Law Scams

John McAfee Charged With Crypto Fraud

John McAfee has been charged for cryptocurrency fraud by the Manhattan federal court, along with a business associate who goes by the name of Jimmy Gale Watson Jr. 

Failure To Report Earnings For 4 Years

Mr Watson reportedly served as a top level advisor on what courts are calling a “cryptocurrency team”.

Mr Watson — aged 40 — was arrested in Texas and will face a federal judge in a preliminary hearing on Friday, in Dallas. According to an initial statement from the prosecutors, antivirus mogul John McAfee and his crew allegedly made over AUD 16.9 million (USD 13 million) by convincing various investors to buy into a myriad of cryptocurrency-related projects. 

According to US Attorney Audrey Strauss, Mr McAfee used his status to spread false information in 2017 and 2018 that allowed him to make considerable earnings — which he never reported.

“McAfee and Watson exploited a widely used social media platform and enthusiasm among investors in the emerging cryptocurrency market to make millions through lies and deception.”

Although Jimmy Gale Watson Jr. was recently taken into custody,  M. McAfee has been waiting to appear in front of a US Federal Court, even longer, seeing as he is currently being detained in Spain on a separate set of charges on behalf of the US Justice Department.

John McAfee is no stranger to troubles with Law Enforcement, as he’s been in hot water with authorities in the USA and Belize before — and in July 2019, he was released from detention in the Dominican Republic following an arrest on suspicion of going on a yachting trip with high-calibre weapons and other unspecified military-grade gear.

Categories
Australia Crypto News Scams

Qoin Kicked Out Of Blockchain Australia as Alex Saunders Calls it a Big Scam

A recent Notice of Member Disciplinary Resolution from Blockchain Australia states that Qoin’s membership with them is now terminated.

NOTICE OF MEMBER DISCIPLINARY RESOLUTION 

For those that don’t know, Qoin is a cryptocurrency founded in the Gold Coast, Queensland which was targeting retail merchants across Australia – offering free Qoin to new members.

Is Qoin a Scam?

Alex Saunders of Nuggets News recently called Qoin “A massive scam” and urged people to “get their money out before it collapses”. Crypto News also had reports that some Qoin members were able to cash out and sell their Qoins for Aussie dollars. Others instead apparently hit error messages and were unable to cash out.

Interestingly, searching LinkedIn for Qoin members reveals titles such as “Qoin Agent”, “Qoin Accredited Agent”, “Qoin Ambassador” or “Qoin Master Agent”. This seems to suggest elements of multi-level marketing, where adoption could be driven by a tiered rewards system for front-line sales agents.

No Response

A few months ago, Crypto News reached out to founding members of Qoin and Bartercard, asking them to address concerns over the project. Disappointingly, no response has been received yet – neither via email, phone nor LinkedIn. An appropriate conclusion is left for the readers to draw.