BitConnect tied to Indian demonetization, three owners on the run

May 24, 2018 mlmdetective 0

It appears BitConnect, a Ponzi scheme with losses potentially running into the billions, was launched to skirt newly introduced demonetization law in India.On November 8th, 2016, the Government of India announced the demonetization of all ₹500 and ₹1000 banknotes.
The government claimed that the action would curtail the shadow economy and crack down on the use of illicit and counterfeit cash to fund illegal activity and terrorism.
The sudden nature of the announcement and the prolonged cash shortages in the weeks that followed created significant disruption throughout the economy.
If CID investigators are to be believed, this triggered the launch of the  BitConnect Ponzi scheme.
CID officials…

VictoriaBank’s petition for an appeal rehearing denied

May 24, 2018 mlmdetective 0

The Zeek Rewards Receivership is one step closer to recovering $13.1 million from VictoriaBank, following the denial of rehearing petition.Following a successful appeal by the Zeek Receiver, challenging a decision that would see VictoriaBank keep $13.1 million stolen from Zeek Rewards victims, VictoriaBank filed a petition for an appeal rehearing on April 9th.
In a brief two-page order filed on May 22nd, VictoriaBank’s petition was denied.
The court denies the petition for rehearing and rehearing en banc.
No judge requested a poll under Fed. R. App. P. 35 on the petition for rehearing en banc.
Entered at the direction of the panel: Chief Judge Gregory, Judge…

Redwood Scientific Technologies continue to miss production deadlines

May 24, 2018 mlmdetective 0

Our initial story on Redwood Scientific Technologies’ troubles with the FTC left off with an April 23rd show cause hearing.In a nutshell, Redwood Scientific Technologies, who own the MLM company Rengalife, have been accused of violations of the FTC Act.
Rather than cooperate, Rengalife had failed to provide the FTC with requested information.
Having missed several deadlines, the FTC was now treating the matter as a contempt of court issue.
As per a filed May 22nd Status Report, we pick up the story right before the April 23rd hearing.
The day before the April 23rd hearing, a Sunday, saw Redwood Scientific Technologies attorney send the FTC’s…

$2 million recovered from Zeek net-winners over 2018 first quarter

May 23, 2018 mlmdetective 0

The Zeek Rewards Receiver’s Status Report for the first quarter of 2018 reveals another $2 million has been recovered from net-winners.This brings the total amount currently held by the Zeek Receivership to $27.8 million.
The Zeek Recievership is primarily engaged in the US net-winner lawsuit, following up claims against foreign net-winners, the USHBB lawsuit and the ongoing VictoriaBank saga.
While a final distribution to Zeek Rewards victims is pending, the Receiver advises a smaller interim distribution is unlikely.
We hold funds sufficient to make another small interim, partial distribution.
However, the expense associated with making such a distribution counsels against making it.
Instead, the Receiver expects…

Five out of six Ominto board members resign following NASDAQ delisting

May 23, 2018 mlmdetective 0

Prior to delisting itself from the NASDAQ exchange over ongoing compliance issues, Ominto had a six-team Board of Directors.On May 18th, three days after the NASDAQ delisting was announced, five of Ominto’s Board of Directors resigned.
Why Mitch Hill, Gregory Newell, Jaye Connolly-LaBelle, Peter Harris and Gary Baughman resigned hasn’t been made public.
An Ominto press-release states only that the resignations were “without disagreement”.
Considering Ominto’s NASDAQ compliance issues and Dubli’s continued operational losses, the timing of the resignations certainly appears ominous.
Ominto’s remaining Board Member, CEO Michael Hansen, appears confident the company will continue to operate.
The search has already commenced for new members of our Board.
In particular, we are pursuing…

USI-Tech securities fraud cease and desist issued in Ohio

May 23, 2018 mlmdetective 0

As part of Operation Cryptosweep, Ohio has issued USI-Tech with a securities fraud cease and desist.The May 18th notice identifies USI-Tech Limited as the sole respondent, through a PO Box address in Dubai.
The cease and desist appears to have been issued following a local investor complaint.
After being pitched on USI-Tech by “Mark Grobril” [sic] in April 2017, the unnamed Ohio investor (R.V.) deposited $22,000 into USI-Tech.
This would be USI-Tech’s infamous Bitcoin Package Ponzi scheme, officially launched in mid 2017.
Note that although misspelt, I believe the complaint refers to Mark Ghobril (right),one of USI-Tech’s top promoters.
When R.V. told (Ghobril) of his intention to withdraw…

DasCoin securities fraud cease and desist issued in BC, Canada

May 22, 2018 mlmdetective 0

DasCoin is the latest MLM cryptocurrency to receive a securities fraud cease and desist.As part of Operation Cryptosweep, the British Columbia Securities Commission issued DasCoin with a cease and desist notice.
As at the time of publication the DasCoin cease and desist notice hasn’t been made public. Nor do we know exactly when it was issued.
Seeing as the notice is part of Operation Cryptosweep however, I believe DasCoin was served sometime over April or May.
On the MLM side of things DasCoin is promoted through Net Leaders (formerly Coin Leaders).
On the Net Leaders website, the company markets itself as “the home of DasBlockchain”.
As…

Kidnapping and extortion escapades in India reveal BitConnect owner?

May 22, 2018 mlmdetective 0

A builder in India has been arrested as part of a Rs. 1.5 billion bitcoin extortion bust ($22.7 million USD).Three months ago local builder Shailesh Bhatt had filed a complaint with the Gujurat Criminal Investigation Department.
In his complaint Bhatt alleged extortion by the Amreli police.
Amreli is a district in Saurashtra, Gujurat.
Upon investigating Bhatt’s complaint, Gujurat CID agents discovered
Bhatt had extorted bitcoins worth crores from others before he was kidnapped by the Amreli police.
Kidnapped? Yeah… this gets messy.
Two years ago another man, Satish Kumbhani, began promoting the BitConnect Ponzi scheme across Gujurat.
The builder, Shailesh Bhatt, was one of the victims that fell…

Trident Crypto Fund cease and desist issued in New Jersey

May 22, 2018 mlmdetective 0

Trident Crypto Fund emerged in April 2018 as yet another MLM cryptocurrency Ponzi scheme.Built around the recently launched TDC ICO, Trident Crypto Fund solicits investment in bitcoin on the promise of daily ROIs of up to 1% in TDC points.
Following an Operation Crypto-Sweep internal investigation, New Jersey has issued Trident Crypto Fund with a securities fraud cease and desist.
Although New Jersey doesn’t go into specifics regarding it’s investigation, it’s easy enough to put two and two together.
Outside of Trident Crypto Fund TDC points are worthless.
The business model sees bitcoin transferred to Trident Crypto Fund’s anonymous owners, in exchange for TDC.
TDC is…

US cracking down on crypto scams through Operation Crypto-Sweep

May 22, 2018 mlmdetective 0

The North American Securities Administrators Association announced Operation Crypto-Sweep on Monday.Through Operation Crypto-Sweep, NASAA has revealed seventy cryptocurrency company investigations.
NASAA members from more than 40 jurisdictions throughout North America participated in “Operation Cryptosweep,” which to date has resulted in nearly 70 inquiries and investigations and 35 pending or completed enforcement actions related to ICOs or cryptocurrencies since the beginning of May.
As above, around half of the investigations are completed or pending enforcement.
For those unfamiliar with the association, NASAA describe themselves as
a voluntary association whose membership consists of 67 state, provincial, and territorial securities administrators in the 50 states, the District of…