The US Federal Trade Commission is reimbursing about 8,000 victims of money loss from investing in two bitcoin scams. Scams promise that investors can turn around $ 100 of crypto payments into $ 80,000 in monthly income.
Pyramid scheme victims get their money back
The Federal Trade Commission (FTC) has begun sending refunds to victims of two crypto investment scams: Bitcoin Funding Team and My7network.
According to an announcement by the FTC on Wednesday, the two programs “mistakenly promised that participants could earn large sums of money by paying cryptocurrencies like bitcoin or litecoin to sign up. programs”. However, the FTC detailed:
Bitcoin and My7network Funding Groups are chain referral schemes that depend on recruiting new people to make money. In fact, most of the participants failed to recover their initial investments.
The FTC is sending 7,964 refunds through Paypal totaling more than $ 470,000 to the victims of the two plans that started on November 5. “The average refund is about 59 dollars. The recipient who receives the refund via Paypal will have 30 days to accept the payment, ”FTC clarified.
The promoters of the two programs – Thomas Dluca, Louis Gatto and Eric Pinkston – ceased operations in March 2018. They claimed that the Bitcoin Foundation “could turn equivalent payments of just over $ 100 into $ 80,000 monthly income, ”the FTC explained and added that the two plans were“ a chain introduction scheme – a kind of pyramid scheme ”.
The FTC alleges that the fourth defendant, Scott Chandler, prompted the Bitcoin Foundation and another scam cryptocurrency recruitment scheme called Jetcoin. The scam claimed that investors could double their investment in 50 days, but the FTC said “the program failed to fulfill these requests and stopped working within two months. since launch ”.
The defendants violated the “Act prohibiting fraudulent practices of the FTC by misrepresenting chain referral plans as a genuine monetization opportunity and by falsely declaring that participants can earn money. Enter significantly by participating in three programs, “the federal agency explained.
Last August, the promoters settled with the FTC. As part of their proposed deals, Dluca will pay $ 453,932 and Chandler $ 31,000. Pinkston also agrees with a $ 461,035 judgment, which will be suspended upon paying $ 29,491, due to his inability to pay the full amount. If he is later found to misreport his finances, he will be required to pay the full amount, ”noted the regulator.
In addition to the monetary judgment, all four defendants are “permanently barred from administering, participating in or assisting others in promoting or operating any multi-level marketing, pyramid, Ponzi or referral scheme. string, “FTC stated.
What do you think about the FTC refunding victims of bitcoin fraud? Let us know in the comments section below.
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