The company operated a pyramid scheme in which the funds were diverted to the accounts of the directors, who took advantage of the capital to support their tastes and pleasures. The authorities warn that this type of scam is very common, and they invite potential investors to be very attentive so that they detect the warning signs.
The US Department of Justice (DoJ) filed charges against Luiz Capuci Jr, who operated as CEO of the crypto mining and investment company Mining Capital Coin, which they accuse of perpetrating fraud against thousands of investors, whom they jointly defrauded of at least USD $62 million in alleged commercial offers.
CEO falls Mining Capital Coin In U.S.A
In a press release published by the DoJ last Friday, the accusations against Capuci come to place after the diversion of funds from users to their personal accounts, which he captured after promoting investment in alleged “trading bots”which would carry out thousands of transactions per second and generate profits for the people who allocate their capital to the company.
The DoJ alleged that Capuci operated a kind of pyramid scheme, in which the investment capitalized by the new entrants was intended to pay the older ones, motivating them to bring a greater number of people in exchange for rewards such as iPads, Apple Watchesand even offering a luxurious ferrari to the member who achieved the best results for the benefit of the company.
After capturing the capital, Capuci diverted the funds to his private wallets and that of some accomplices, with which they acquired luxury properties and supported ostentatious expenses to maintain a lifestyle in which they showed off their financial bonanza to attract potential victims.
In this regard, the assistant attorney general responsible for the case, Kenneth A. Polite, Jr, commented:
“Cryptocurrency-based fraud undermines financial markets around the world as bad actors defraud investors and limit the ability of legitimate entrepreneurs to innovate within this emerging space… The Department is committed to following the money, whether be it physical or digital, to expose criminal schemes, hold these fraudsters accountable, and protect investors.”
As such, Mining Capital Coin under the direction of Capuci it offered a supposed investment scheme that contemplated different edges. A complaint filed with the US Securities and Exchange Commission (SEC) details that the strength of the proposal were cryptomining packages with daily returns of 1%, which were paid weekly through the same platform.
Initially, those responsible for Mining Capital Coin They assured that the profits would be in Bitcoin, but then they introduced changes detrimental to investors, requiring for example that withdrawals be made in Capitalcoin, the company’s native cryptocurrency that had no trading value outside the platform. Another warning sign came when the supposed annual memberships expired, since errors appeared for the processing of the requests, and in most cases the victims were asked to buy more investment packages so as not to lose the capital trapped in the platform.
The fraudulent scheme operated by Mining Capital Coin It was operational at least since January 2018, so it is estimated that there were more than 65,000 affected victims. The authorities warn that this modality is quite common, so they alert possible interested parties to consider the warning signs before investing their capital, waiting for such promises to be fulfilled, which appear to be very good.
As for Capuci, he currently faces charges of wire fraud, securities fraud, international money laundering and other crimes, for which he could serve a maximum of 45 years in prison if the court finds him guilty of all the accusations against him. .
Angel Di Matteo version / DailyBitcoin
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