...and is definitely not an enormous grift that's pouring lighter fluid on our already smoldering planet.
Created by Molly White. Subscribe to her newsletter for weekly recaps.
However, $53.9 million of investor funds were used to pay other investors, in classic Ponzi fashion. The brothers also used investor funds to build houses for themselves and their family, purchase vehicles and designer goods, and make payments on a $30 million condo in Miami for Tanner.
One of the brothers, Jonathan, had in 2004 been convicted on felony securities law violations that resulted in a four-year jail sentence and more than $300,000 in restitution.
Abra settled the charges from the SEC by agreeing to an obey-the-law injunction, and agreeing to pay as-yet-undetermined civil penalties.
In January 2024, Abra settled claims from the Texas State Securities Board by agreeing to refund customers. As a part of the complaint, the TSSB had alleged that Abra was "insolvent or nearly insolvent", and had been making misleading statements. In June 2024, Abra settled with 25 state regulatory agencies, agreeing to refund up to $82.1 million to its US customers. Abra had begun winding down operations in the United States in mid-2023, after facing multiple state regulatory actions.
One member of the Discord described losing more than $140,000 in tokens after clicking a link shared by a person appearing to be a member of the Polygon team, which advertised a token distribution to serve as a "pre-migration celebration".
They then boasted about their haul on the compromised Instagram account, changing the bio to say: "Sorry mah nigga you have just been rug pulled by India_X_Kr3w thank you for the $700,000 in Solana 🇮🇳".
The token stunt by the massive company was perhaps made more believable by McDonald's previous forays into crypto, including when they launched a McRib-themed NFT project in December 2021. The company had also joked about a "Grimacecoin" back in January 2022, in a reply to a tweet from Elon Musk.
The attacker later moved the stablecoins to a new wallet, and exchanged about half of them for 10,625 ETH.
Between May and July of 2023, Hanes transferred $47.1 million of the bank's funds to the fraudulent scheme. This ultimately led to the bank collapsing, with equity investors losing $9 million and the FDIC footing the bill. "There were people who lost 70, 80% of their retirement" as a result of their investment losses, stated a community member.
Hanes had also taken money from a local church, an investment club, and his daughter's college savings. These funds were reportedly used to buy cryptocurrency after those running the scheme told him they needed more money to "unlock" the returns on his investments — a common tactic with these scams.
Ziemian was wanted on international warrants from Poland and South Korea. FutureNet, which was established in 2018 and purported to be a crypto trading platform, is alleged to have defrauded numerous people of a combined $21 million. Victims were encouraged to buy "participation packages", and earn rewards for referring others to the scheme. Polish authorities warned that FutureNet might be a pyramid scheme in 2019, and South Korea began an investigation into the company in 2020.
Ziemian faces fraud, money laundering, and theft charges, which could be punished by life imprisonment in South Korea.
Now, Austin "DNP3" Taylor has pleaded guilty to wire fraud after stealing around $1.14 million in investor funds from his CluCoin project, which had claimed it would "help others in need". DNP3 himself had built up a reputation of making generous gifts while livestreaming. He transferred the stolen funds to online casinos, where he then gambled them away.
Taylor faces up to 20 years in prison. The statement from the U.S. Attorney's Office announced that authorities would be notifying identified victims via NFT, and encouraging them to submit statements to the FBI.
Scammers impersonating crypto company support representatives are everywhere on social media and elsewhere. Now, it seems, they are purchasing Google ads to rise to the top of Google search rankings. While Google says they attempt to remove fraudulent advertisers, some slip through the cracks.
While phishing attacks like this are prevalent both in crypto and in tradfi, crypto platforms often do not have similar safeguards as major banking platforms to try to thwart unauthorized transactions, nor do they have the same ability to reverse transactions that are made.
The SEC's lawsuit also targets six other promoters of the NovaTech scheme, all of whom the agency says used "religious overtones" when attracting new investors. Ultimately, the scheme was revealed to be a Ponzi scheme, with new investors' money being used to pay out previous investors, as the promoters also took money for themselves.
No JavaScript? That's cool too! Check out the Web 1.0 version of the site to see more entries.
