Guilty until proven innocent.
- Another Ponzi scheme
- Mining City surprised by SEC decision
- Cryptocurrency scams are not uncommon
SEC accused innocent mining city of fraud (updated)
A mining company in the Philippines turns out to be a Ponzi scheme
Investors bought the hashrate, hoping for a profit
There are several scam projects on the cryptocurrency market
The Philippine Securities Commission (SEC) accuses the mining project Mining City of misappropriating investors’ money. However, the company has denied any involvement in the fraudulent scheme..
Another Ponzi scheme
According to an official SEC ruling in the Republic of the Philippines, the Mining City mining project was recognized by the Ponzi scheme and closed pending a court decision. According to the SEC, the company was organized by a group of people headed by Georgy Rogovsky. Other participants in the criminal scheme also appear in the case, namely Anthony Aguilar, the head of the Philippines office and John Ray Gray, the administrator of the Facebook group.In June 2019, Facebook announced preparations for the release of the Libra digital currency. The social network project immediately attracted the attention of … More who were engaged in attracting funds from investors.
Mining City offered its clients to invest in the purchase of mining facilities for mining Bitcoin Value (BTCV) cryptocurrency. At the same time, investors could choose their own investment plan and profit from the coins allegedly mined and sold..
The investment amount could vary from $ 300 to $ 12600. The payment included: a limited number of days for mining, a percentage of the hash rate, as well as various bonuses. Thus, the project managed to attract dozens of miners who invested in the project. In fact, it turned out that the Mining City project is nothing more than just a Ponzi scheme..
“This scheme, used by MINING CITY, clearly points to a possible Ponzi scheme, where money from new investors is used to pay ‘fictitious profits’ to previous investors and is intended mainly to support top recruiters,” the SEC said in a statement..
In other words, only the organizers, the first investors and recruiters who invited new clients to invest in the project, received profit from this scheme. At the same time, a very powerful advertising campaign was carried out. According to the official statement of the department, the fraudsters used advertising on social networks, on YouTube video hosting, as well as other Internet sources..
At the moment, the activities of Mining City have been stopped, and the organizers and participants are awaiting a court decision. Under the laws of the Republic of the Philippines, violators of the Securities Act can be fined 5 million pesos and sentenced to imprisonment for up to 21 years. In addition, all Mining City members will be entered in a special register of persons who can no longer open a business in cryptocurrencies or the financial sector. All money received from investors must be returned to the owners.
Mining City surprised by SEC decision
The BeInCrypto editorial team received an official response from Mining Sity regarding the current situation. The company claims to have no office in the Philippines.
“We are surprised and regretful to learn that the Philippine Securities and Exchange Commission has listed Mining City as a Warning Company. We consider it our duty to clarify and comment on the current situation. This situation may have arisen due to incorrect information about our organization and activities posted by individuals in the Philippines who claim to be representatives of Mining City, although they are not..
The company also stressed that social media accounts are not Mining City’s official media channels. Moreover, it does not offer investments and securities, but sells computing power (hashing power). Clients from different countries use them for safe and secure cryptocurrency mining.
Cryptocurrency scams are not uncommon
Cryptocurrency scams are not uncommon. Taking advantage of the fact that the cryptocurrency market does not have a clear enough regulation, criminals are looking for loopholes for carrying out fraudulent transactions with coins. One of the most striking examples of the Ponzi scheme is the PlusToken project. In just a year, the scammers managed to attract more than $ 3 billion and then disappear with the money..
Earlier, BeInCrypto reported that at least 7 projects that were popular among a huge number of investors turned out to be a scam. Among them, in addition to the notorious PlusToken, are Prizm, BTC Trade, OneCoin and others..
Well-known Bitcoin critic Nouriel Roubini considers the entire crypto market to be one big scam. Ponzi schemes are the highest form of fraud that Bitcoin is capable of, and cases like PlusToken are proof of this, Roubini said. Roubini has long been one of the most ardent opponents of the cryptocurrency industry. However, not everyone approves of his position, reproaching the Nobel Prize winner in economics for one-sided views.
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