CFTC busts fraudulent Bitcoin trading scheme; charges accused of swindling BTC worth $147 million

In sync with rising crypto-adoption, government bodies have stepped up and implemented stricter regulations, in light of the space’s history and susceptibility to fraudulent activities. The Commodity Futures Trading Commission (CFTC) has been making a lot of effort in this regard and recently, caught a Bitcoin trading and investment company for fraudulent activities. According to the civil […]
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Source: AMB Crypto

Bitcoin [BTC]: Victims of crypto-crimes seek $11 billion in compensation

Cryptocurrency-related crimes have risen exponentially over the past few years. Recently, the cases of close to 30 victims of cryptocurrency-related crimes were backed up by a law firm, with the victims demanding a compensation of $11.2 billion.
The news was first reported by Micky, and the victims were from countries, including the United Kingdom, Italy, Slovakia, Australia, US and more. Dr. Jonathan Levy, the solicitor at the firm Berlad Graham LLP, revealed that the crime involved people from various countries and the jurisdiction of the case fell under EU law.
The original report also claimed that a majority of the highlighted cryptocurrency nodes were controlled by EU nations.
According to Levy, social media is one of the key reasons behind the increase in the number of such crimes. Dr. Levy also noted that criminals “could not function without fintech and blockchain companies, exchanges, banks, and especially social media, which accelerated and facilitated this illicit transfer of wealth”.
Levy claimed that social media was a “silent partner” to such crimes, and added that social media giants were enriched by “setting up the victims and selling their data to crypto criminals”.
According to Michael McKibben, a social media expert with the firm, it was easy for social media platforms to keep a tab on crypto-related crimes. However, they often chose to ignore it.
With the alarming crime rate, there were rumors that the government might classify and regulate cryptocurrencies or even ban it. However, Dr. Levy said that it was unlikely that the government would ban them. However, the government would now look at addressing regulations and accountability in a larger way, he said.
He added,
“Obviously Russia and China have taken one route. On the other hand, the US, without answering the big questions seems to be going after criminals selectively. The EU, however, has really done nothing but is the one jurisdiction with supranational money laundering and data rules. I think the EU will set the tone because everyone will need to conform since almost all crypto business touches Europe.”
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Source: AMB Crypto

Crypto Scam Alert: YouTube Videos Promoting “Bitcoin Generator” Really Pushing Malware

Scammers are attempting to hijack the popularity of YouTube crypto content and investors’ hunger to get rich quick to defraud potential victims. This involves tricking someone into downloading a programme under the pretence that they’re actually getting some sort of non-existent Bitcoin multiplying software.
Once downloaded, the malware uses several different methods to defraud victims. These include key logging, as well as stealing browser credentials and crypto wallet files.
Crypto Scammers Take to YouTube to Promote Trojan-Hiding Software
According to a report in digital security publication Bleeping Computer, a new crypto scam has been discovered. Those behind it use YouTube videos to promote a “Bitcoin generator” tool. Naturally, for those less tech savvy, and ultimately, gullible, the promise of free Bitcoin is simply too great a temptation to resist and they follow the link in the video’s description.
The victim is then taken to a download page away from YouTube. There, they are instructed to download and run a Setup.exe file, just as they would be had they been downloading most software.
If they download and install the file, their computer becomes infected with the Qulab Trojan, a particularly savage programme intended to steal information and hijack clipboards.
Scammers are using increasingly sophisticated methods to defraud those interested in crypto.
Although reported by Bleeping Computer, the scam was first discovered by a researcher known as Frost. They have apparently been tracking the campaign for just over two weeks. Once Frost manages to identify the videos and report them, however, the scammers simply create a new account and upload the fake Bitcoin generator promotional material once again.
The impact of the Qulab could be brutal for those not on top of their digital security, and let’s face it, if you’re downloading crypto generators from mysterious websites, you’re probably not a cyber security genius.
The software first attempts to steal all sorts of data from the user’s browser. This includes history, saved credentials, cookies, and various social media credentials. On top of this, the Trojan can also steal .txt, .maFile, and .wallet files from a computer.
However, the Qulab virus doesn’t stop there. It also hijacks clipboards. Since cryptocurrency addresses are long strings of characters and some people are worryingly blasé about copying and pasting them, the idea is that once copied, if the Trojan spits out a different public key (of a wallet under the scammer’s control), there is a fair chance that the victim won’t realise and will send their Bitcoin or other crypto assets to the hacker’s wallet.
The scammers have been able to tailor the Trojan to target the following crypto asset wallets: Bitcoin, Bitcoin Cash, Cardano, Bitcoin Gold, Bytecoin, Lisk, Dash, Doge, Electroneum, Ethereum, Graft, Litecoin, Monero, Neo, QIWI, Qtum, Steam Trade Link, Stratis, VIA, WME, WMR, WMU, WMX, WMZ, Waves, Yandex Money, and ZCash.
Related Reading: Remarkably Basic Scam Nets Criminals $2 Million in Bitcoin and Other Assets
Featured Image from Shutterstock.
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Source: New

Bitcoin [BTC]: Higher BTC price brings more BTC scams?

As the cryptoverse regains its lost shine with the recent bull run and welcomes a new breed of enthusiasts, the bad players in the market have amped up their efforts into conning the naive crowd. One of the upcoming scams in this light is the “digital wallets,” that are being identified and blocked on a daily basis. Pioneering this wave of stopping fraud is @LukasStefanko, who recently highlighted two apps on Google Play. The tweet read,
“Phishing “Trezor Mobile Wallet” app found on Google Play and pops as a second search result. This fake app was phishing for credentials, but still it couldn’t affect Trezor user funds, however it could be used for email phishing.”
The tweet consisted of screenshots that warned the crypto users to download the correct “TREZOR Manager” app, instead of the [fake] “Trezor Mobile Wallet” app.
Source: @LukasStefanko
@LukasStefanko further informed Twitter that the fake app was “connected” to “Coin Wallet” service which was another cryptocurrency wallet on Google Play with over 1,000 installs using the same source code and server.” He further informed the readers that  “Trezor Mobile Wallet & Coin Wallet were bought as wallet template for $40” and added a screenshot of the source code as a proof of his findings.
Source: @LukasStefanko
While the apps are still available for download, the recent finding ought to urge users to make use of legitimate sources for indulging in cryptoverse. Currently, Crypto Twitter is spreading the information in the hopes of reducing such scams that surface with BTC hype.
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Source: AMB Crypto

Possible Bitcoin [BTC] scam: BCSC warns Canadian Bitcoin exchange promising unrealistic investment returns

Canada’s regulatory agency, the British Columbia Securities Commission [BCSC], issued a warning against a suspicious trading platform, Canada Bitcoin Exchange Inc. [CBE]. The platform was offering excessively attractive investment plans with exponential gains, and subsequently came under the BCSC’s radar recently.
Source: Canada Bitcoin Exchange
The investment returns for all the four plans listed on the website were based on High Yielding Investment Programs [HYIP], which offered extraordinarily high investment returns. The exchange purported 3,586% returns in 48 hours and 7,985% returns in a mere 24 hours. The platform accepted payment mainly in Bitcoin [BTC], implying that recovering the assets would be very difficult in case of fraud.
Canada’s financial watchdogs confirmed that the suspicious entity was not registered to trade in British Columbia. The Commission further urged people to exercise caution while dealing with platforms similar to the one in question.
Another interesting aspect about the platform’s website was that apart from a basic Customer Support section, there was no mention of any licenses granted by any recognized regulatory body. Following the discovery, the BCSC reportedly found out that CBE was an unregulated organization.
Despite many in the online crypto community speculating that CBE might be a scam or a fraudulent organization, it is still not evident whether the platform did dupe investors. Two blockchains associated with the Bitcoin address provided on CBE’s website were identified on the Bitcoin block explorer service, Both these aforementioned addresses had recorded zero transactions.
For the BCH address,

According to domain search portal Who.Is, and newsBTC, the exchange was registered under the domain, NameSilo, LLC. It was further reported that the account was created after 1 August, 2017.
Source: Who.Is
Off late, crypto-platforms and exchanges have flocked to places with crypto-friendly regulations such as Malta and Switzerland, following the massive scrutiny and institutional challenges and warnings associated with trading in the US and Canada.
In the past three months alone, around 40 regulatory bodies in the US and Canada have issued cautionary alerts, urging investors to do their homework before dealing with any crypto-platform.
NASAA [North American Securities Administrators Association] President and Alabama Securities Commission Director, Joseph P Borg, had this to say in August 2018,
“State and provincial securities regulators are committing significant regulatory resources to protect investors from financial harm involving fraudulent ICOs and cryptocurrency-related investment products and also are raising awareness among industry participants of their regulatory responsibilities.”
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Source: AMB Crypto

US FBI Arrested Man Behind Billion Dollar Crypto Pyramid Scheme

The latest report states FBI or the US Federal Bureau of Investigation has arrested ‘Konstantin Ignatov’ of the billion-dollar pyramid scheme called, ‘OneCoin’ at the Los Angeles International Airport (LAX) on March 06, 2019.
FBI shared a report on the official website of ‘Department of financial justice’ on March 08, 2019. According to the release, OneCoin is a Multibillion-Dollar Pyramid Scheme which had defrauded many investors – consequent to the release, Konstantin, and his partner have been allegedly selling the fraudulent cryptocurrency across the world. As per the earlier reports, OneCoin’s 22 promoters have already been charged – particularly selling the scam ‘OneCoin’ in India. Along with India, China and other central banks had also warned OneCoin and its team on scamming the investors out of over $4 billion.
When FBI arrested him at the Airport – it has been revealed that Ignatov has been in the US since Feb 27 (researched gathered from his seized devices).

Founded in 2014, OneCoin is reportedly a scam product by the founder Konstantin Ignatov and his sister Ruja Ignatova (worked as a lead for this product). The OneCoin Ltd, is a network marketing product where existing users get paid the commission on attracting new users to its platform. After a year or two – regulators began questioning the legitimacy of the product, particularly, since 2016 – however, the promoters and founders enjoyed millions of dollars by attracting over 3 million members across the globe, particularly throughout Europe and Asia.
Concerning the mater, William Sweeney, Jr. who is the Assistant Director-in-Charge at FBI explained that;
“As we allege, OneCoin was a cryptocurrency existing only in the minds of its creators and their co-conspirators.
Unlike authentic cryptocurrencies, which maintain records of their investors’ transaction history, OneCoin had no real value. It offered investors no method of tracing their money, and it could not be used to purchase anything. In fact, the only ones who stood to benefit from its existence were its founders and co-conspirators.”
The post US FBI Arrested Man Behind Billion Dollar Crypto Pyramid Scheme appeared first on Coingape.
Source: CoinGape

Bitcoin [BTC] worth $300,000 stolen by scammers in email-based “Sextortion” racket

Cyber criminals have targeted the cryptoverse once again, absconding with over $300,000 in Bitcoin [BTC] this time. The act was committed through a series of blackmail campaigns weaponized via emails, dubbed the “Sextortion” scam.
The scam began in 2017, but it piques the interest of the larger community only after its list of victims grew in mid-2018. According to research by Digital Shadows, a UK-based digital risk assessment firm that tracked over 792,000 targeted emails, Bitcoin in the range of $300,000 was stolen from over 3,100 unique BTC addresses.
The report further stated that the funds were then deposited in as many as 92 Bitcoin addresses. The firm further suggested that the criminals engaged in “sextortion” and extorted an amount totaling $540 in Bitcoin from each victim.
The report defined “sextortion,” as follows,
“Spam campaign claiming to have footage of recipient watching pornography. Included threats to publicly release video.”
Victims of this scam were sent an email with a threat that an explicit video of them was recorded, via their webcam, and would be floated on the Internet if a certain amount of Bitcoins were not sent to a given address.
Digital Shadows reported a divergence of emails sent to victims, with some showing bare understanding of how to craft an email and how its distribution worked, resulting in some of them being deposited in the spam folder. Others were well curated and sent from newly created Outlook email addresses.
The scam was operated from a number of locations, or rather IP addresses. According to the report, the highest proportion of the emails disseminated from Vietnam (8.5 percent), Brazil (5.3 percent), and then India (4.7 percent). The research firm further suggested that the email servers could have been compromised, which was why specifying an accurate location was inconclusive.
New accomplices were hired by the scammers to continue their ongoing operations and were paid a whopping $360,000 a year, the report said. Additionally, the criminals who had skills in network management, penetration testing and programming expertise were paid $768,000 a year.
Individuals who had a high net-worth were targeted for these scams on social media. Furthermore, the scammers also targeted the victim’s marital status, using it to form an online relationship with a married person and threatening to reveal details of the same if the ransom in Bitcoins was not paid.
Rafael Amado, a senior strategy and research analyst at Digital Shadows further elaborated that social media sites like LinkedIn were primarily targeted to find the right victim. He stated,
“Using it can help identify a potential victim’s job, likely salary and firms they have worked for. They may also disclose details of family members, marital status and their location. If this is supplemented with breach data such as passwords then it can make an extortion attempt more potent.”
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Source: AMB Crypto

Scammers Net Over $300,000 in Bitcoin “Sextortion” Attack

According to research conducted by UK cyber crime investigation firm Digital Shadows and reported in The Next Web, cyber criminals have managed to generate around $332,000 in Bitcoin from an email-based blackmail scam. These funds were sent from over 3,100 unique Bitcoin addresses.
The scam was first reported in 2017. However, the popularity of the attack grew throughout 2018, with many more examples of the emails surfacing.
Many Scammers Using Same Tactics to Earn Bitcoin
The “sextortion” scam, as the publication has deemed it, is rather basic in its design. Victims receive an email stating that they have been recorded viewing explicit content online through their webcam. The sender pledges to go public with the footage if a ransom is not paid in Bitcoin.
As mentioned, more than $332,000 was sent to scammers using this technique. These funds were deposited to a total of 92 Bitcoin addresses. Digital Shadows estimate that an average of $540 was extorted from each of the victims.
As you can see from the below Tweet, the attack is ongoing:

I keep getting emails threatening to send videos of me with my todger out to all my contacts unless I send them a shedload of bitcoins. The #Sextortion scammers are really boring
— Tim Trent (@AluciaCharter) February 18, 2019

The report highlights that different groups using the same basic scam operate with different levels of sophistication. Some of the emails sent are poorly written and show scant knowledge of widespread email distribution. These examples often fail to get past an inbox’s spam filter.
Meanwhile, on the other end of the spectrum, some of the “sextortion” emails show a much higher level of refinement. For example, many of these more sophisticated examples were sent from addresses.
The research undertaken by Digital Shadows involved the analysis of more than 792,000 emails. These were sent from servers thought to be hosted on five different continents. The locations with the highest numbers of emails sent were Vietnam, Brazil, and India. Scammers originating in these nations are believed to be behind 8.5, 5.3, and 4.7 percent of the total number of “sextortion” attempts respectively. However, it is quite possible that the email servers could have been compromised too as part of the attack.
According to a report in The Independent, “sextortion” scammers are increasingly turning to social media sites to target high net worth individuals. In this variant of the above scam, individuals have been offered as much as $1.1 million to help target the most lucrative marks. This more sophisticated version of the scam involves forming a relationship with a married person and then threatening to reveal it if a ransom in Bitcoin is not paid.
Senior strategy and research analyst at Digital Shadows, Rafael Amado, commented on the use of social media in the “sextortion” scam:
“Using it can help identify a potential victim’s job, likely salary and firms they have worked for. They may also disclose details of family members, marital status and their location. If this is supplemented with breach data such as passwords then it can make an extortion attempt more potent.”
Related Reading: Dark Overlord Group: Keep the Bitcoin Flowing, We’ll Keep the Truth Flowing
Featured Image from Shutterstock.
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Source: New

Authorities Caught Fake Website on Deceptive Promotion of National Cryptocurrency

The Monetary Authority of Singapore (MAS) released yet another caution notice on grounds of cryptocurrency. However, this time, scammers ‘allegedly claimed themselves’ as a company, supported by the Singaporean government.
Bogus websites Continue to Emerge
In the latest release, MAS warns the public not to be indulged or misled by the ‘fraudulent crypto firm’ which urged investors towards its scam crypto investment.
These websites falsely claim that Singapore is adopting a cryptocurrency as its official coin. They also claim that a firm has been appointed exclusively to market this cryptocurrency.
The firm is pulling off the public’s attention by using ‘fabricated information about Singapore’s government’. Moreover, it claims to launch a cryptocurrency which is an official digital coin of Singapore. Deceitfully, one such article has found on ‘fabricated website of CNBC’ means that the website appears to be very similar to CNBC news media. It falsely states about the official coin Singapore government is launching.
Image Courtesy – MAS
However, MAS didn’t provide the name of the scam firm as such, it hasn’t revealed the domain where the article was published.
MAS also state the website is trying to steal user’s information and urged them to purchase cryptocurrency by sharing their personal and financial details. The announcement reads that;
This is a scam and members of the public should avoid providing any financial or personal information on the forms linked from the websites.
Although, this is not the first time MAS caution public against the scam, earlier as reported by Coingape, it has seized the security token offering for not complying with the regulatory procedure.

Singaporean Authority (MAS) halts Securities Token Offering for regulatory breach’ states about unnamed ICO violating the law. #STO #Singapore #Mas #Cryptocurrency #Crypto #bitcoin
— CoinGape (@CoinGapeMedia) January 24, 2019

By addressing the scam venture, MAS alerts citizens against investing in cryptocurrency and digital tokens. It states ‘these are highly risky’. Furthermore, it asks members of the public to report to the police if encounter any such acts.
Members of the public who suspect that an investment offer could be fraudulent or misused for other unlawful activities should report such cases to the Police. MAS concluded
The post Authorities Caught Fake Website on Deceptive Promotion of National Cryptocurrency appeared first on Coingape.
Source: CoinGape

Coincheck Owner Monex Warned Clients on New Scam “Monex Coin Management”

Monex Group Inc., the firm which has acquired Japanese hacked Coincheck is claiming that a firm with a similar name is targeting its clients. Consequently, the Monex Group has released a caution announcement, detailing its clients about the scam.
 Scammers Impersonating Monex Group
According to the statement released by the Monex Group Inc, a new crypto startup called ‘ Monex Coin Management’ (マネックスコインマネージメント) is representing itself as the affiliate of the Monex Group and therefore targeting its clients. In fact, the firm is seeking clients to use its ‘automated trading system’ which is more likely appears as it’s a service from Monex Group Inc. Following the attempt, Monex Group Inc. has released a caution notice on its official website, addressing its clients about fake representation’.

The announcement notes that the Group has no relation to the firm ‘Monex Coin Management’. With this, it advises clients ‘not to respond to such solicitations’.
To note, Monex Group Inc. acquired Coincheck during April 2018 and very recently obtained a green signal from FSA to restart the Crypto trading operation. The details of the Monex Group registration with Kanto Financial Bureau as Crypto exchange agency as per the Payment Service Act have already been reported by Coingape. It states;
With the registration as a cryptocurrency exchange agency serving as a milestone, Coincheck strives to continue offering reliable services for our current and prospective customers in a safe and stable manner. Coincheck is also committed to further strengthening security and enhancing usability.
The post Coincheck Owner Monex Warned Clients on New Scam “Monex Coin Management” appeared first on Coingape.
Source: CoinGape

LocalBitcoins Users Scammed of Bitcoin in Phishing Attack, Forum Suspended

Users of the peer-to-peer OTC Bitcoin trading service LocalBitcoins have been targeted by cyber criminals as part of a phishing scam, resulting in the user’s Bitcoin being stolen.
Forum users were being redirected to a phishing site, which was prompting the users to input two-factor authentication codes that were used to access user accounts and empty them of all their Bitcoin.
LocalBitcoins Forum Compromised, Reddit Users Report
According to a PSA on Reddit posted bu u/bitcoinbabeau, LocalBitcoins has been compromised and the site’s forum landing page has been redirecting users to a phishing site. Once at the phishing site – designed to closely mimic the actual LocalBitcoins forum in order to dupe users – users were prompted to login and enter sensitive two-factor authentication codes.
After the hackers gained access to the user’s sensitive account data, the accounts were then emptied of all Bitcoin.
Related Reading | ShapeShift Phishing Site Advertisement Tops Google Search Results
LocalBitcoins has “temporarily disabled” its forum according to the splash page message. The message also directs users to the LocalBitcoins sub-reddit, where horror stories are already being shared.

@LocalBitcoins has apparently been compromised. Users are claiming its forums were redirecting them to a login page that was a phishing website.
An address shared on social media already has $28,000 worth of #BTC in it after tricking 5 victims. Forums are now diabled. #bitcoin
— Francisco Memoria (@FranciscoMemor) January 26, 2019

“Yeah I think I was the first to get cleaned out. 0.14btc. 5 victims going to one wallet. And that’s just one wallet we know about that belongs to the attacker,” reported u/tefl0ncc. 

Another user claimed to be cleaned out of 11 BTC total.
One user posted the hacker’s wallet address, which appears to have only stolen 7.95 BTC across 5 transactions. This already amounts to over $28,000 in Bitcoin. However, additional wallet addresses may be involved considering the report of 11 BTC being stolen from another user.
LocalBitcoins Phishing Attack: Was DNS Spoofing to Blame?
As of the time of this writing, LocalBitcoins has yet to comment on the matter, but do appear to be aware of the situation considering their prompt response in taking down the forum.
How the attack occurred isn’t yet clear, however, it appears to be a fairly common DNS spoofing attack. Hackers use DNS spoofing to maliciously redirect users from one site to a fake one, usually designed to – just like in the case here with LocalBitcoins – steal user’s sensitive personal information, and use it to access the user’s accounts.

Not your vault, not your gold.
— Jesse Powell (@jespow) January 25, 2019

Reddit users also suggest that the hacker “used some sort of script to use the 2FA code entered by the user to withdraw the bitcoin.”
Related Reading | New Phishing Email Threatens BTC Users
Last year, the popular Ethereum and ERC-20 token wallet MyEtherWallet was also targeted in a DNS spoofing attack. Users then logged into the fake site they were redirected to, allowing hackers to gain access to their funds.
Users can protect themselves by always double-checking the URL of the page they are currently on, and should always look for the lock next to the URL indicating that the page has a secure connection.
The post LocalBitcoins Users Scammed of Bitcoin in Phishing Attack, Forum Suspended appeared first on NewsBTC.
Source: New

New Cryto Scam Caught & Suspended on Social Media – Founder Warns Users

Looks like the eleventh largest cryptocurrency, Cardano is now been targeted by scammers. Weiss rating and co-founder of Cardano cryptocurrency or ADA warned users against the scam coin similar to name Cardano. In fact, it is named as ‘Cardano Classic’.
ADA Scam Detected – Beware
Accordingly, Charles Hokinson released a caution notice on social media. Addressing to so-called Cardano Classic as a scam, Charles says that;
They have no relationship to our project and if you give them money you will likely lose it.

Cardano Classic is a scam. They have no relationship to our project and if you give them money you will likely lose it. Beware anyone trying to borrow a name for legitimacy
— Charles Hoskinson (@IOHK_Charles) January 24, 2019

Beside the co-founder, Weiss Ratings also cautioned users against the scam coin. However, there seems no relation between Cardano and Cardano Classic but the name of the coin sounds more like stealing Cardano’s authority for a marketing stunt.

SCAM ALERT: A new “crypto” has surfaced, called Cardano Classic. It has no connection whatsoever to the real #Cardano. Beware #CardanoClassic scam! When scammers are trying to mimic your coin – that’s a sign of popularity. #ADA #altcoins #crypto #cryptocurrency
— Weiss Ratings (@WeissRatings) January 25, 2019

At present, Cardano (ADA) is the eleventh largest cryptocurrency, stands just a step back from Bitcoin SV which is on tenth spot. According to the data from coinmarketcap, ADA holds the average marketcap of $1,120,359,390 with a positive mark of 1.65 percent over the past 24 hrs.

As per the reports, Cardano Classic team intends to create an ‘open-source online royalty payment model’. Beside resource claims its team members profiles as a fake profiles, the scam project has also been suspended on Twitter.

Stay tuned with Coingape to be updated with latest updates on crypto industry.
The post New Cryto Scam Caught & Suspended on Social Media – Founder Warns Users appeared first on Coingape.
Source: CoinGape

Ether Scammers Doubled Their 2017 Profits in 2018: Report

A new report released by blockchain research firm Chainalysis has revealed that the value of ether extracted by crypto scammers in 2018 was more than twice the amount harvested in 2017. According to the report, cybercriminals made away with $36 million worth of ether through various swindles in 2018, as against $17 million in 2017.
Unlike hackers who utilise cryptojacking malware, phishing, ransomware and other types of malicious attacks to exploit user system weaknesses and steal or extort cryptocurrency, this class of attackers operates in the more time-honoured fashion of internet scams – convincing people to voluntarily hand over money that will supposedly be used for a purpose which turns out to be a lie.
The report states that more than 40,000 people fell victim to these scams in 2018, which is more than four times the number of people scammed in 2017. More than 2,000 fraudulent wallet addresses were also identified as the scams continue to grow in scope and sophistication.
Ponzi Schemes and Fake Investments
The report reveals that by far the most profitable ether scam conducted in 2018 was the pyramid scheme, in which ether holders are contacted by fraudsters asking for a donation of a specific amount that will be rapid with a specific amount of guaranteed interest. As with all Ponzi schemes, the first few users do indeed receive the promised funds, which incentivises them to recruit more victims and help the scheme cycle up until the fraudsters controlling the pyramid pull out the money and disappear.
This scenario played to several times in 2018, most notably with 333 ETH, which reaped about $3.5 million in ETH. The Ethereum DApp, which promised users daily returns of 3.33 percent on a fixed buy-in amount achieved significant popularity despite being repeatedly identified as a scam. Eventually, the Russian-owned platform was shut down and the scammers melted into thin air as per their usual custom.
Apart from Ponzi schemes, cybercriminals also cashed in on the smouldering embers of the ICO craze to harvest large ETH sums. While 2018 was not quite the bumper year for ICOs that 2017 was, investor still retained a heightened interest in token sales and some criminals took advantage of this by creating a plethora of cryptocurrencies, accompanied by whitepapers, roadmpas and marketing campaigns. When investors bought into these ICOs using ETH as was the typical ICO practise, the scammers then transferred the funds to wallets they controlled and pulled the plug on the websites and social media assets, in what is now knows as the classic exit scam.
The post Ether Scammers Doubled Their 2017 Profits in 2018: Report appeared first on Coingape.
Source: CoinGape

Apollo (APL) Founder Steve McCullah Finally Speaks on Scam Allegations

Recently, there was a story questioning the authenticity of Apollo (APL) cryptocurrency and its founder Steve McCullah. This started with a Reddit post by a user named RozzyPoffle. The founder of Apollo, however, has spoken up, denying all the allegations against him and his company although the cryptocurrency community is definitely not convinced by his words.
In defense of the Apollo project
In an article titled “Apollo Cryptocurrency Scam Answered by Steve McCullah”, the founder attempted to defend his company against every claim by RozzyPoffle. Just yesterday, RozzyPoflle wrote on the Bitcoin subreddit that his prediction of a pump and dump has finally come true as billions of APL were moved from the company’s main wallet to exchanges which resulted in a 78% drop in the price of the asset. To that, McCullah said:
“As I stated before, there is no reason for anyone involved with the Apollo Foundation to sell on any exchange because we get constant OTC offers from investors that purchase amounts too large for exchanges.”
There are however verifiable wallet addresses that were involved in the transactions which the founder has completely denied. As RozzyPoffle rightly observes, he did not give any explanation to the transfer of billions of APL, he simply said the company does not sell to exchanges because it has many offers from over-the-counter buyers. Does it mean APL was not sold on exchanges? If yes then how did the price drop by almost 80% within a minute?
Another key allegation was that the APL team pumped up the price by fighting everyone who dares say anything negative about the cryptocurrency in their Telegram group. To this, he said the group admin can only remove members from the online community if they violated a set of strict rules and not because they made negative statements about the project.
However, RozzyPoffle said
“I have at least 20 screenshots of it (bans) happening directly on my computer. Here’s one: a user gets banned because the admin says they had seen that user in the NXT Telegram. That user did not do or say anything at all besides engage in normal conversation:”
Evidently, McCullah has been very much focused on increasing the price of the asset and has talked about it all the time. However, in this interview, he says any member of his team that even insinuates a price increase in the future gets fired. It’s kind of confusing, really. But there is more.
RozzyPoffle isn’t the only one seeing something wrong
This story has drawn a lot of attention, so Cryptoslate did a thorough investigation and stumbled upon a few key personalities who gave their thoughts on the issue. One of them was Lior Yaffe, a co-founder of Jelurida, the company that manages NXT.
“It’s a pure money grab. The features they promised in their roadmap are either trivial or very complex beyond their ability or simply impossible,” Yaffe said.
In addition to this, he confirmed the fact that Apollo stole NXT codes, against which McCullah said they have replaced hundreds of thousands of codes. Yaffe said:
“…to refute this, I will need to take my best devs to look at his code and expose his fake claims. I guess he speculates that we don’t have the time for this. It’s a war of attrition,”
and that the private feature that the project boasts of isn’t private at all.

This evidence is overwhelming and I’m not sure how McCullah will get out of it. Some members of the crypto community are asking why he has not been arrested yet. Well, the answer is simple; his perceived victims are actually his accomplices, for they attack anyone who speaks against the founder or the company and never gives a thought to any of the stories flying around.
The post Apollo (APL) Founder Steve McCullah Finally Speaks on Scam Allegations appeared first on Coingape.
Source: CoinGape

Is Apollo (APL) a Scam? Evidence Mounts to Suggest So

According to a lengthy Reddit post from earlier today, Apollo (APL) has all the hallmarks of a massive scam to enrich its creators. The allegations, coming from Reddit user RossyRoffle, state that there are many red flags with the project, suggesting that the “all-in one cryptocurrency” is nothing more than vaporware dressed up as ground-breaking tech.
The major points of contention in today’s post focus around the lack of development towards grandiose ambitions, an former alleged scam artist being behind the cryptocurrency project, a slew of fake news being sold to followers as fact, and a harsh policy of censorship in community groups for anyone discussing the claims made by those behind Apollo.
Apollo (APL) Comes Under Fire on a Variety of Fronts
Seemingly exasperated by the reported censorship experienced on Apollo’s community platforms, a Reddit user known as RossyRoffle has attacked the cryptocurrency for several reasons. The post from earlier today states that despite the grandiose Bitcoin, Ethereum, and XRP-killing claims of those behind Apollo, the project offers very little of substance.
On Apollo’s own website, visitors are presented with a slick video stating that Apollo is optimised for a variety of applications – be it token creation, private transfers, smart contract use, file sharing, multi-signature support, and a host of others. Basically, if you have ever heard of a cryptocurrency project claiming to have created something innovative, Apollo can do it – apparently.
RossyRoffle refutes all of this in their post. They state that Apollo is nothing more than a fork of NXT with a lower block time. There are some other “insignificant” code changes too but apparently these barely extend past name changes for existing functions of the more established NXT chain. The poster even goes on to highlight that the website itself was built using Wix – hinting at the lack of experience of those behind the alleged scam.
That’s not all, however. RossyRoffle states that the founders of APL are attempting to aggressively pump the price up to enrich themselves. Claims are cited that the platform will render XRP and ETH entirely obsolete. In addition, the poster provides some addresses to show how much APL the founders are dumping on the market as the price rises due to the “fear of missing out” created by those behind the operation.
“Here are some APL Founder-held addresses if you’d like to watch them get rich in real-time: APL-4BUY-KK5W-B3KC-DMHBM and APL-NZKH-MZRE-2CTT-98NPZ.”
Along with the grandiose claims of the project itself, fuelling this so-called “FOMO” is allegedly a programme of fake news and harsh censorship. The poster highlights completely unsubstantiated claims that the team has secured thousands of real-world buying locations. Those who question this on the official Telegram channel (and other platforms) are immediately banned.
This aggressive censorship apparently extends to other questions that seem to be genuinely seeking a better understanding of the APL technology, including:

“Isn’t the privacy of this coin exactly the same as NXT? Can someone explain how it is any better?”
“Why do you keep banning people for asking legitimate questions?”
“How do you plan to implement sharding in Q1 when their is no code in the Github for it yet?”
“You guys think the privacy of this coin is really better than Monero?”

The Reddit poster goes on to challenge their readers to join the Telegram group and ask a question. I tried and did not even get the opportunity to put anything to the team – presumably a result of a slew of requests to join the group following the original post:

Another of the issues highlighted in the post that creates an air of doubt around the project is the founder’s past. According to RossyRoffle, Steve McCullah previously launched a fake Kickstarter campaign to fund a documentary in South America in search of undiscovered dinosaur species. They go on to allege that McCullah disappeared after raising just sort of $30,000.
Of course, cryptocurrency scams like those alleged above are nothing new and pump-and-dump schemes have become an industry norm for smaller cap coins. However, the major difference with this effort according to RossyRoffle is that everything about the project is fraudulent and the entire thing serves only as a vehicle to enrich its founders, rather than an orchestrated effort from a third-party group to pump up a tiny cap coin to make a quick buck.
Related Reading: Crypto Pump and Dump Schemes Encourage Traders to Play Digital Chicken
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