Cryptocurrencies, tokens, NFTs, virtual "assets" frauds

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Crypto exchange set up by Three Arrows co-founders to shut down​

OPNX will shut down after a little over a year in operation. PHOTO: REUTERS

Claire Huang
Senior Business Correspondent

FEB 2, 2024

SINGAPORE - A cryptocurrency exchange set up by the co-founders of failed crypto hedge fund Three Arrows Capital will say goodbye to its users on Valentine’s Day.
OPNX, created by Three Arrows’ Mr Zhu Su and Kyle Davies for the trading of bankruptcy claims, will shut down after a little over a year in operation.
Users of the exchange were notified in an e-mail that they have to settle their accounts and make the necessary withdrawals before Feb 14.
The two men had set up OPNX with co-founders Mark Lamb and his wife Leslie, as they tried to stage a comeback six months after Three Arrows collapsed and two months after the infamous fall of Sam Bankman-Fried’s crypto exchange FTX.
The Lambs are behind CoinFlex, a digital asset exchange that filed for restructuring in the Seychelles in August 2022.
OPNX was started to let creditors of insolvent exchanges such as FTX tokenise their claims and allow claims as collateral.
Mr Zhu and Davies, who went to the same school and university and worked as traders at Credit Suisse, founded Three Arrows in 2012.

It was the first big crypto firm to go bankrupt in 2022, wiping out billions of investors’ funds, amid the fallout from the collapse of cryptocurrencies Luna and TerraUSD in May that year.
Mr Zhu was arrested at Changi Airport in September 2023 while trying to leave the country.
He and Davies, whose whereabouts is unknown, were both sentenced to four months’ imprisonment for failing to cooperate with investigations into Three Arrows’ failure.
The duo were also handed a nine-year ban by the Monetary Authority of Singapore, barring them from taking part in the management, acting as a director or becoming a substantial shareholder of any regulated capital market services company here.
Mr Zhu, who was released from prison in December 2023 after serving his sentence, in a recent podcast described his time in Singapore prison as “really enjoyable”.

 

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Woman who stole $5.6m in crypto and bought penthouse ordered to return sums​

The High Court ordered Ms Ho Kai Xin to pay back the stolen sums, after crypto exchange ByBit Fintech successfully sued her. PHOTO: ST FILE

Selina Lum
Senior Law Correspondent

JUL 27, 2023

SINGAPORE – A woman who handled the payroll for a cryptocurrency exchange stole US$4.2 million (S$5.6 million) worth of crypto, then went on a spending spree, including buying a $3.7 million freehold penthouse after cancelling her Build-To-Order flat.
The High Court ordered Ms Ho Kai Xin to pay back the stolen sums, after crypto exchange ByBit Fintech successfully sued her to recover the stolen assets.
In his judgment issued on Tuesday, Justice Philip Jeyaretnam ruled that the holder of a crypto asset has a property right recognised in common law as a thing in action.
A thing in action is a right over intangible property that can only be enforced by legal action, not by physical possession. An example of a thing in action is a debt.
It is the first time that this has been decided in any common law court.
Justice Jeyaretnam said his reasoning was not strikingly different from how the law approaches other social constructs, such as money.
“It is only because people generally accept the exchange value of shells or beads or differently printed paper notes that they become currency. Money is accepted by virtue of a collective act of mutual faith,” he added.

The judge examined this issue because he had to decide whether crypto assets are indeed property capable of being held on trust.
The case concerned a cryptocurrency called Tether, a “stablecoin” which is pegged to the United States dollar and commonly referred to as USDT.
He concluded that the USDT is a thing in action. Like any other thing in action, USDT is capable of being held on trust, he said.

“While some people are sceptical of the value of crypto assets, it is worth keeping in mind that value is not inherent in an object,” he added.
“A wooden chair that can float is more valuable on a ship that is sinking than a golden throne would be.”
Ms Ho was employed by WeChain Fintech, which provided payroll services for ByBit.

On Sept 7, 2022, ByBit discovered that eight unusual cryptocurrency payments had been made between May 31, 2022, and Aug 31, 2022. A total of 4.2 million USDT was transferred to four “addresses”, which are encrypted digital folders that can receive and store cryptocurrency.
ByBit also discovered that $117,238.46 was transferred to Ms Ho’s personal bank account in May 2022.
On Oct 4, 2022, after she was confronted with the investigation findings, Ms Ho told ByBit that the addresses belonged to her cousin, and that he had asked her to help make the transfers.
After this meeting, she ceased contact with ByBit and WeChain.
ByBit filed a lawsuit against her on Oct 12, 2022, and obtained injunctions to freeze the various assets.
Ms Ho was the only person who updated the spreadsheets that listed the addresses designated by ByBit’s employees to receive their pay in cryptocurrency.
ByBit contended that she manipulated the spreadsheet files and wrongfully caused it to pay the crypto into the four addresses she controlled.
In her defence filed on Nov 11, 2022, Ms Ho blamed her supposed cousin, Mr Jason Teo, for stealing the crypto from ByBit without her knowledge.
ByBit then discovered that she had made several big-ticket purchases from July 2022 onwards, including the penthouse apartment bought with her husband. She also spent $362,000 on a new car and $30,000 on Louis Vuitton goods.
She claimed that the penthouse was bought with money she earned from cryptocurrency trading, but did not provide details of the transactions.
On March 30, 2023, ByBit applied for summary judgment, which meant it was asking the court to decide in its favour without going through a trial. Ms Ho did not attend any court hearing or file submissions.
ByBit’s case was that she had abused her position to transfer the assets to herself. It sought a declaration that Ms Ho holds both the USDT and the money on trust for ByBit, as well as an order for her to return the assets.

Justice Jeyaretnam found that ByBit has established that she held the assets as a trustee by operation of law and had wrongfully transferred the assets.
“The evidence is indeed compelling that Ms Ho fraudulently transferred the crypto asset and the fiat asset to herself,” he said.
The judge noted that there was direct evidence that she owns the digital wallet associated with one of the addresses, as well as the circumstantial evidence of her unexplained spending spree.
ByBit declined to comment when asked through their lawyer, Mr Gerard Quek, if it has made a police report.

 

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‘Pig-butchering’ scams net over $101 billion globally: Study​

"Pig butchering" scams often start with what appears to be a wrong-number text message. People who respond are then lured into fake crypto investments. PHOTO: ST FILE

MAR 01, 2024

NEW YORK - “Pig-butchering” scammers have likely stolen more than US$75 billion (S$101 billion) from victims around the world, far more than previously estimated, according to a new study.
Dr John Griffin, a finance professor at the University of Texas at Austin, and graduate student Kevin Mei gathered crypto addresses from more than 4,000 victims of the fraud, which has exploded in popularity since the pandemic. They tracked the flow of funds from victims to scammers largely based in South-east Asia.
Over four years, from January 2020 to February 2024, the criminal networks moved more than US$75 billion to crypto exchanges, said Dr Griffin, who has written about fraud in financial markets. Some of the total could represent proceeds from other criminal activities, he said. “These are large criminal organised networks and they’re operating largely unscathed.”
Pig butchering – a scam named after the practice of farmers fattening hogs before slaughter – often starts with what appears to be a wrong-number text message. People who respond are lured into crypto investments.
But the investments are fake and once victims send enough funds, the scammers disappear. As far-fetched as it sounds, victims routinely lose hundreds of thousands or even millions of dollars. One Kansas banker was charged in February with embezzling US$47.1 million from his bank as part of a pig-butchering scam.
The people sending the messages are often themselves victims of human trafficking from across South-east Asia. They are lured to compounds in countries, including Cambodia and Myanmar, with offers of high-paying jobs, then trapped, forced to scam, and sometimes beaten and tortured. The United Nations has estimated that more than 200,000 people are being held in scam compounds.
The study – titled How Do Crypto Flows Finance Slavery? The Economics Of Pig Butchering – was released on Feb 29. Dr Griffin and Mr Mei found that US$15 billion had come from five exchanges, including Coinbase, typically used by victims in Western countries. The study said that once the scammers collected the funds, they most often converted them into Tether, a popular stablecoin. Of the addresses touched by the criminals, 84 per cent of the transaction volume was in Tether.

“In the old days, it would be extremely difficult to move that much cash through the financial system,” Dr Griffin said. “You’d have to go through banks and follow ‘know-your-customer’ procedures. Or you’d have to put cash in bags.”
Tether chief executive officer Paolo Ardoino called the report false and misleading. “With Tether, every action is online, every action is traceable, every asset can be seized and every criminal can be caught,” he said in a statement. “We work with law enforcement to do exactly that.”
Tether has cooperated with the authorities in some cases to freeze accounts tied to fraud. But often, by the time the crime is reported, the scammers have cashed out.

Dr Griffin said the study shows Tether is “the currency of choice for criminal networks”.
Chainalysis, a blockchain analysis firm, said the study’s totals might be inflated. Just because a blockchain address receives some money from a pig-butchering scam does not mean all the money received by that address comes from fraud.
“Quantifying funds earned through pig-butchering scams is challenging, given limited reporting,” said Chainalysis spokeswoman Maddie Kennedy. Tether is one of the company’s customers.
Many of the fraud victims’ blockchain addresses were collected by Chainbrium, a Norwegian crypto investigations firm.
Chainbrium conducted its own analysis of the data and found that a large proportion of the funds flowed through a purportedly decentralised crypto exchange called Tokenlon. Scammers use the exchange to obscure the source of the funds, according to Chainbrium. Tokenlon did not respond to a request for comment.
“People in the United States... their money is going straight to South-east Asia into this underground economy,” said Chainbrium consultant Jan Santiago.
Eventually, the criminals would send the scam proceeds to centralised crypto exchanges to cash out for traditional money.
Dr Griffin said Binance is the most popular exchange, even after the company and its founder Zhao Changpeng pleaded guilty in November to criminal anti-money laundering and sanctions charges and agreed to pay US$4.3 billion to resolve a long-running investigation by prosecutors and regulators.
“Binance is the place where they can move large amounts of money out of the system,” Dr Griffin said.
Like Tether, Binance has worked with law enforcement in some cases to freeze accounts tied to fraud and return money to victims. A company spokesman said it recently worked with the authorities to seize US$112 million in a pig-butchering case. BLOOMBERG

 

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Complaints made in US, S’pore against local firm that promised quick returns on crypto investments​

Mr Lee Dalton (centre), identified on the firm’s now-defunct website as its founder and chief executive, with co-founder Richmond Ray Gonzales (right) and marketing manager Reid Fletcher. PHOTO: INVESABLEAI/INTERNET ARCHIVE

Aqil Hamzah

MAR 24

SINGAPORE - A Singapore-registered firm is under investigation after allegedly failing to pay investors who have pumped money into its cryptocurrency investment schemes.
Reports have been filed against InvesableAI with the Singapore police, and with the United States Federal Bureau of Investigation (FBI) and Securities and Exchange Commission (SEC).
Incorporated in the Republic on June 19, 2023, InvesableAI is believed to have promised investors quick returns on cryptocurrency investments that banked on the use of artificial intelligence technology.
Its founders claimed to have sought a licence from the Monetary Authority of Singapore (MAS) and, on the firm’s now-defunct website, said it was a trustworthy business because “we are a registered company”, with a separate webpage showing its address in Singapore.
It is a “live” company or a business that is still in operation, according to Accounting and Corporate Regulatory Authority (Acra) records.
Checks by The Straits Times on the details of InvesableAI’s Acra records revealed several discrepancies, including in the company’s registered address, the nationality and address of a foreign director, and the identity of a Singaporean director.
In response to queries, an Acra spokesperson said: “Acra is unable to comment due to ongoing investigations.”

Meanwhile, the FBI and SEC said they could neither confirm nor deny that they were investigating the matter.
Several of the reports lodged with the FBI and SEC, and seen by ST, show that more than 4,000 people have invested money in InvesableAI.
The total sum allegedly sunk into the business by all investors is unclear, but a smaller group of about 150 investors have counted losses of at least US$1.5 million (S$2 million).

One of the investors, a 46-year-old woman, said she trusted the firm because it promised transparency and accessibility for investments in alternative currencies.
The woman, an American, pumped more than US$15,000 into InvesableAI on July 13, 2023, but about two months later, the firm informed her and other investors that withdrawals would be paused “temporarily”.
In a Sept 17 e-mail to investors seen by ST, the firm said there was extreme volatility in the cryptocurrency market, and asked for 40 days to recover losses.
It also offered refunds within a week to those who wanted them.
The e-mail was signed by Mr Lee Dalton, who is identified on the firm’s website as its founder and chief executive.
Six months later, investors said they have yet to get their money back.
The American woman, who holds a Master of Business Administration degree and lives in California, said: “I wish I had known how to do trades on my own, instead of depending on others. It was a bad decision… but InvesableAI seemed to hit all the marks when it came to its legitimacy.
“It being based in Singapore was assuring because of the stringent guidelines that are required there.”
ST spoke to several others in a group totalling about 150 investors – including the American woman – who have banded together to tally their losses.
The group has also compiled a spreadsheet that details the outstanding sums due to more than 60 of them.
Transaction records of more than a dozen investors showed that some managed to make withdrawals ranging from US$25 to almost US$25,000 until September 2023.
However, it is unclear if any of the investors have gotten back their original investments, which ranged from US$500 to more than US$50,000, according to the spreadsheet and transaction records seen by ST.
An archived version of InvesableAI’s now-defunct website lists the minimum investment at US$500, with packages that promise returns of up to 160 per cent of the principal amount in 20 days for a US$10,000 investment.
Claiming to have more than 14,000 members, the firm also had a referral programme where investors could earn higher interest rates on certain deposits if they roped in others successfully.
When ST visited the Woodlands address listed in InvesableAI’s Acra records on March 12, a firm that deals in water treatment and engineering design was found to be occupying the space instead.
When contacted, a representative of the water treatment firm said he was unaware of the existence of InvesableAI, and that the space had not been leased out to other firms.
The water treatment firm’s Acra file showed it has been occupying the Woodlands space since February 2022, before InvesableAI was registered.

InvesableAI’s business records showed its office address to be at 12 Woodlands Square. However, when ST visited on March 12, the unit was occupied by another company. ST PHOTO: NG SOR LUAN
Checks showed that HeySara, a digital corporate service provider, handled InvesableAI’s incorporation.
Foreigners who want to incorporate a business in Singapore must engage a registered filing agent, which can be a corporate service provider.
Asked about InvesableAI’s use of the Woodlands address in Acra’s records, HeySara associate director Chew Shin Yee said the address in the application was provided by Mr Dalton, who is listed as a director in the Acra records.
She said: “We received the order online and conducted our due diligence based on our internal procedure, policy and control.”
But HeySara did not conduct any checks on Mr Dalton’s financial background, she added, as he wanted to incorporate the company with only a $1,000 paid-up capital. She did not elaborate on how the company vetted the information.
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Acra’s guidelines for registered filing agents on anti-money laundering and countering financing of terrorism – published in January 2023 – put non-resident customers in a higher-risk category.
In such situations, registered filing agents must get more information on the source of customers’ funds, for example.
Ms Chew also said there is no information about InvesableAI’s business model, as the staff who handled the account had already quit HeySara.
She did not respond to follow-up e-mails from ST seeking clarification, including on the discrepancy between HeySara’s vetting of InvesableAI and Acra guidelines.
Mr Dalton is listed as an American citizen in the Acra records, with a home address in Texas.
Checks against publicly available property records and data brokers found that an elderly couple with no relation to Mr Dalton have been living at the address since 2009.

Three packages that InvesableAI offered to investors. PHOTO: INVESABLEAI
Mr Dalton’s photo features on the firm’s website, with a marketing video for InvesableAI showing him speaking with an Australian accent against the backdrop of the Kuala Lumpur Tower at night.
In phone video footage filmed last July, Mr Dalton is seen announcing the extension of a promotion and asking individuals to select a particular package and “just start making money”.
In an article published on Yahoo Finance on June 24, 2023, it is stated that Mr Dalton was formerly from the Australian navy and came from Malaysia. ST has contacted Yahoo for comment.
Meanwhile, a Singaporean man is named in the Acra records as the firm’s other director, although he was not listed on InvesableAI’s website.
Instead, its other co-founder was listed online as Mr Richmond Ray Gonzales, whose now-deleted LinkedIn account said he is based in Singapore.
According to that account, an archived version of which was seen by ST, he is the channel sales leader for a multinational corporation dealing in business consulting services.
Queries have been sent to the company asking for more details about Mr Gonzales.

Although he is not listed in the business record of InvesableAI, Mr Richmond Ray Gonzales was said to be the co-founder and chief executive on its website. PHOTO: INVESABLEAI/INTERNET ARCHIVE
Both Mr Dalton and Mr Gonzales were named in the FBI and SEC reports.
Attempts to contact Mr Gonzales through his last-known phone number were unsuccessful, while a social media account in Mr Dalton’s name turned out to be a fake with a Nigerian phone number.
In separate YouTube videos that have since been deleted, the two men said the firm was “in the process of getting” a licence from the MAS, describing it as one that is recognised globally.
In response to queries, an MAS spokesperson said anyone who provides a payment service in Singapore requires a licence.
Otherwise, he will need to be exempted from the Payment Services Act to operate.
The spokesperson said: “InvesableAI is not licensed nor exempted from licensing by MAS.
“Regardless of whether an entity is regulated by MAS, it is an offence to run a fraudulent or deceptive business in Singapore.”

 

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Crypto trader convicted in $150 million Mango Markets fraud​

Federal jurors in New York on April 18 found Avraham Eisenberg guilty of commodities fraud, commodities manipulation and wire fraud. PHOTO: REUTERS

APR 19, 2024

NEW YORK - A trader accused of exploiting Mango Markets rules to steal US$110 million (S$150 million) from the exchange was convicted of fraud in the first US trial involving criminal charges tied to cryptocurrency manipulation.
Federal jurors in New York on April 18 found Avraham Eisenberg, 28, guilty of commodities fraud, commodities manipulation and wire fraud for his actions on Oct 11, 2022, when his trading boosted the price of futures contracts by 1,300 per cent in 20 minutes.
Sentencing was set for July 29. He faces 20 years in prison on the wire fraud count and 10 years on each of the other charges.
Eisenberg, a self-described “applied game theorist”, traded under a false identity and drove up the price of Mango’s token, MNGO, as well as contracts based on its relative value compared with a stablecoin called USDC, prosecutors said. He then exploited a feature of the exchange that let him “borrow” against his holdings, withdrawing US$110 million in cryptocurrency that he had no intention of repaying, the US charged.
Prosecutors said Eisenberg “pumped” the price of MNGO tokens to pull off a fraud he planned for weeks against Mango Markets, a decentralised finance platform run by smart contracts.
“He manipulated that price so he could trick the system into giving him money,” Assistant US Attorney Thomas Burnett said in closing arguments on April 17. “He planned to take the money and run.”
Mango Markets, which lets people borrow, lend and trade cryptocurrencies, was overseen by a decentralised autonomous organisation, or DAO.

Days after his big haul, Eisenberg agreed to return US$67 million in crypto in exchange for the DAO not pursuing his prosecution or freezing his remaining assets. Eisenberg left Puerto Rico, where he was living, shortly after his Mango trades and flew to Israel. When he returned to Puerto Rico on Dec 26, 2022, US agents arrested him. He has been in jail ever since, after a judge ruled he posed a risk of fleeing before trial.
In his closing argument, Eisenberg’s attorney Brian Klein said his client executed a perfectly legal strategy permissible under the rules of the exchange. Eisenberg “engaged in a successful and legal trading strategy, one in which he put his own money at risk”, Mr Klein said. He said Eisenberg “wholly complied” with smart contracts that controlled the decentralised finance platform, which only warned users: “This is unaudited software, use it at your own risk.”
Mr Klein said Eisenberg does not dispute that he made a series of trades taking opposing long and short positions. “It’s not illegal to take big risks,” he argued.
But Mr Burnett said the rules of the Mango Markets platform do not protect Eisenberg from prosecution for fraud and manipulation.
“Just because something is possible doesn’t make it legal,” the prosecutor said. BLOOMBERG

 

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Binance crypto founder Zhao sentenced to four months in prison​

Changpeng Zhao stepped down as Binance’s chief in November. PHOTO: NYTIMES

MAY 01, 2024

WASHINGTON - Changpeng Zhao, the former chief executive of Binance, was sentenced on April 30 to four months in prison after pleading guilty to violating US laws against money laundering at the world’s largest cryptocurrency exchange.
Once considered the most powerful crypto industry figure, Zhao, known as “CZ”, is the second major crypto boss to be sentenced to prison.
The sentence imposed by US District Judge Richard Jones in Seattle was significantly shorter than the three years sought by prosecutors, and below the maximum 1½ years recommended under federal guidelines.
It was also much lighter than the 25 years behind bars that Sam Bankman-Fried received in March for stealing US$8 billion (S$10.9 billion) from customers of his now-bankrupt FTX exchange. Bankman-Fried is appealing his conviction and sentence.
Still, prosecutors cheered the outcome of what had been a years-long investigation into Binance and Zhao, a billionaire who had been living beyond US reach in the United Arab Emirates.
“This was an epic day,” US Attorney Tessa Gorman told reporters outside the courthouse. “Incarceration was critical in this case and we’re pleased with the result.”
Before handing down the sentence, Mr Jones faulted Zhao for making Binance’s growth and profitability a higher priority than complying with US laws.

“You had the wherewithal, the finance capabilities, and the people power to make sure that every single regulation had to be complied with, and so you failed at that opportunity,” he said.
Zhao, 47, did not visibly react upon hearing his sentence.
He wore a navy blue suit and tie in the courtroom, with his mother and several other family members in attendance. Defence lawyers had requested probation.

“‘Crime pays’ is the message sent today,” Mr Dennis Kelleher, head of the financial reform advocacy group Better Markets, wrote in an e-mail, noting Zhao will still get to keep his vast wealth.

‘I’m sorry’​

Prosecutors said Binance employed a “Wild West” model that welcomed criminals, and did not report more than 100,000 suspicious transactions with designated terrorist groups including Hamas, Al-Qaeda and Islamic State.
They also said Zhao’s exchange supported the sale of child sexual abuse materials and received a large portion of ransomware proceeds.
Binance agreed to a US$4.32 billion penalty, and Zhao paid a US$50 million criminal fine plus US$50 million to the US Commodity Futures Trading Commission.
“I’m sorry,” Zhao told the judge before being sentenced.
“I believe the first step of taking responsibility is to fully recognise the mistakes. Here I failed to implement an adequate anti-money laundering program ... I realise now the seriousness of that mistake.”
Much of Binance’s misconduct, including its weak money laundering controls, was first reported by Reuters.

Zhao will surrender voluntarily to serve his sentence, most likely at a detention centre near Seattle-Tacoma International Airport.
“Not prioritising compliance is a few shades below criminal intent. It’s bad, but it’s below the usual requirement of specific intent” that would justify a years-long sentence, said MrRobert Frenchman, a lawyer specialising in white-collar crime.
But given the scale of Binance’s violations and the massive fines imposed, he should not have expected probation or home detention, Mr Frenchman added.

Not a monster​

Prosecutors had told the judge a tough sentence would send a clear signal to other would-be criminals.
“We are not suggesting that Mr Zhao is Sam Bankman-Fried or that he is a monster,” prosecutor Kevin Mosley said.
But Zhao’s conduct, he said, “wasn’t a mistake. This wasn’t a regulatory ‘oops’.”
Zhao stepped down as Binance’s chief in November, when he and the exchange he founded in 2017 admitted to evading money-laundering requirements under the Bank Secrecy Act.
In seeking probation, defense lawyers said others who admitted to similar wrongdoing, including BitMEX founder Arthur Hayes, were not locked up.
Zhao “wanted to make a difference in the world”, but made mistakes, defence lawyer Mark Bartlett said.
Mr Jones said the three-year sentence requested by prosecutors was inappropriate because they did not show that Zhao knew in advance about illegal activity.
“It’s always the case the government asks for more than they think they’ll get,” said Mr Frenchman. “Going that much above guidelines for a pleader is unusually aggressive.”
Several other crypto moguls are also in the crosshairs of US authorities after the collapse of crypto prices in 2022 exposed fraud and misconduct across the industry. REUTERS

 

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5 years’ jail for ‘key cog’ in cryptocurrency investment scam where victims lost $1.1m​

Chinese national Wang Xinghong pleaded guilty to six cheating charges and was sentenced to five years’ jail on Aug 6. ST PHOTO: KELVIN CHNG

Shaffiq Alkhatib
Court Correspondent

Aug 06, 2024

SINGAPORE – He was the chief technological officer (CTO) of a firm offering a cryptocurrency investment scheme and which claimed that it had 300,000 physical mining machines that could “mine cryptocurrency” to generate revenue.
However, the company identified as A&A Blockchain Innovation did not have these machines and was, in fact, running a Ponzi scheme when it induced 12 investors to part with more than $1.8 million.
But in total, the prosecution said that between May 2021 and February 2022, A&A attracted investments from more than 700 investors in Singapore, amounting to around $6.7 million.
According to the Coinbase website, mining is the process that several cryptocurrencies use to generate new coins and verify new transactions.
Chinese national Wang Xinghong, 40, whom the prosecution described as a “key cog” in the investment scam, pleaded guilty to six cheating charges and was sentenced to five years’ jail on Aug 6.
He had told investigators that he received around US$100,000 (S$132,500) from his involvement in A&A.
Wang has made no restitution and the prosecution said that as A&A operated a money circulation scheme, some of the affected investors were paid returns using money from other investors.

Deputy Public Prosecutor Wong Shiau Yin told the court that the total loss suffered by the investors across Wang’s charges amounted to around $1.1 million.
The cases involving his alleged accomplices, including Dutch national Yang Bin, 61, and Chinese national Lu Huangbin, 60, are still pending.
At the time of Wang’s offences, Yang was the chairman and overall person in charge of A&A, while Lu was its chief executive.

DPP Wong said Yang incorporated A&A on April 20, 2021.
Between May 20, 2021, and Feb 15, 2022, it offered the “A&A chain mining scheme” to investors in Singapore.
Under this scheme, A&A promised investors a fixed daily return of 0.5 per cent on their investments, which would purportedly be derived from the mining of cryptocurrencies.
In its marketing materials to investors, which included presentation slides and promotional videos, A&A claimed that it had entered into an agreement with a firm called Yunnan Shun Ai Yun Xun Investment Holdings to acquire 70 per cent ownership of 300,000 mining machines in China, which could mine cryptocurrencies such as Bitcoin and Ethereum.
A&A also claimed that it would generate the revenue for returns through the mining of cryptocurrency by using these machines.
In addition, the company developed an app that investors could use to purchase A&A “tokens” to invest in the mining scheme.

Investors could also monitor their purported 0.5 per cent daily returns through the app, the court heard.
DPP Wong said: “In reality, A&A did not enter into an agreement with Yunnan Holdings to acquire 70 per cent ownership of 300,000 mining machines. In fact, A&A did not mine cryptocurrency to generate revenue.
“Instead, A&A operated a money circulation, or Ponzi, scheme, using monies from later investors to pay returns owed to earlier investors.”
Yang managed to engage Wang to develop the app.
However, Wang was aware there was no real mining of cryptocurrency being done and no real returns were paid to investors.
Despite this, he developed the app, which was a centralised software where system managers based in China could input random numbers to falsely reflect investor returns.
The prosecutor said that Wang had central responsibility in maintaining the app and managed a team of China-based system managers.
Wang was also listed as the CTO in A&A marketing materials and had attended board of director meetings that the company had hosted.
Court documents did not disclose how his offences came to light, but he was later charged in court in 2023.
Wang was represented by lawyers Adrian Wee and Lynette Chang from Lighthouse Law, who said Yang used to be one of the richest people in China.
They pleaded for Wang to be given up to three years and 10 months’ jail, adding: “Our client did not conceptualise the cryptocurrency investment scheme.
“He also did not have any roles in the marketing of the scheme to investors or the making of false representations for the purposes of obtaining investment monies... Save for the development of the app, our client had no role in the operations of (A&A).”
For each count of cheating, an offender can be jailed for up to 10 years and fined.

 

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Top FTX executive sentenced to 7½ years in prison​

Ryan Salame enjoyed expensive cars and private jets, and was a prolific political donor. PHOTO: BLOOMBERG

May 29, 2024

NEW YORK - Ryan Salame, a top executive at collapsed cryptocurrency exchange FTX, was sentenced to 7½ years in prison on May 28, making him the first of Sam Bankman-Fried’s circle of advisers at FTX to receive prison time.
Salame, 30, a trusted lieutenant of the exchange’s founder, pleaded guilty in 2023 to a campaign finance law violation and a charge of operating an unlicensed money transmitting business.
He is one of four top deputies in the FTX empire who have pleaded guilty to crimes since the company imploded in November 2022.
Salame’s sentence exceeded the five to seven years that prosecutors had recommended.
He is set to surrender on Aug 29. His lawyers requested that he serve his sentence at the federal prison in Cumberland, Maryland, near his home.
Before FTX failed, Salame was a key figure at the exchange, overseeing its subsidiary in the Bahamas, where the company was based.
As FTX grew into a US$32 billion (S$43 billion) business, Salame spent lavishly. He enjoyed expensive cars and private jets.

He was also a prolific political donor, giving more than US$24 million in the 2022 US midterm elections, mostly to Republicans.
When FTX imploded, Salame became a target of federal prosecutors, who searched his home in Maryland.
In September, Salame pleaded guilty, admitting that he had acted as an illegal “straw donor” who made political contributions at the direction of Bankman-Fried to evade federal disclosure requirements. Prosecutors called it “one of the largest ever” campaign finance offences in US history.
As part of his plea deal, Salame agreed to pay a US$6 million fine and more than US$5 million in restitution.
Before the sentence was announced, Salame briefly addressed the court, apologising to FTX’s customers and his family.
But Judge Lewis A. Kaplan said a long sentence was necessary to send a message to wealthy people about “the consequences of perverting our electoral system and its rules”. Salame “knowingly and wilfully assisted in destroying the limited transparency that the laws of the United States provide in this area”, he said.

 

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More than half of global criminal gains end up at crypto exchanges, says report​

The illicit funds arrive at these exchanges either directly or indirectly, after the criminals use different methods to cover up the asset trail. PHOTO: ST FILE

Claire Huang
Senior Business Correspondent

Jul 12, 2024

SINGAPORE - More than half of global illicit funds from crimes end up at centralised cryptocurrency exchanges, said a report by blockchain analysis firm Chainalysis.
The illicit funds arrive at these exchanges either directly or indirectly, after the criminals use different methods to cover up asset trails, it added.
Criminals turn to centralised exchanges because of the high liquidity and ease of converting cryptocurrencies into fiat, said the report on trends in money laundering in the crypto world released on July 11.
It said these exchanges are integrated into traditional financial services and can help blend illegal funds with legitimate activities.
“There are currently hundreds of centralised services in any given year that receive over US$1 million in illicit funds,” said Chainalysis.
It added that there has been a notable downtrend in the volume received by these exchanges, from nearly US$2 billion (S$2.69 billion) a month at the peak, to about US$780 million a month.
This downward trend reflects better efficiency in anti-money laundering programmes of centralised exchanges in detecting and mitigating such activity, the report noted.

While bad actors use different ways to cash out, the report said there is a high concentration of illicit funds flowing to just five centralised exchanges. These illicit funds are from darknet markets, fraud shops and malware.
The report found that stablecoins now account for the majority of all illicit transaction volume, due to the rise in their use.
This is because both good and bad actors often prefer to hold funds in an asset with a value that will not change based on swings in the market.
However, using stablecoins also adds an element of risk for launderers, as stablecoin issuers have the ability to freeze funds.
Most stablecoins, such as Tether or USDT, and USD Coin or USDC, are issued by centralised entities that have the authority to control and manage their smart contracts.
This means the issuers can proactively monitor transactions for suspicious activity and freeze funds when necessary.
“For instance, both Tether (USDT) and Circle (USDC) have previously indicated that they have frozen addresses associated with illicit activities,” Chainalysis said, adding that Tether has frozen an estimated 1,600 addresses holding funds worth approximately 1.5 billion USDT.
It added that global cooperation is critical in the fight against money laundering.
Criminals often exploit regulatory gaps between jurisdictions, making coordinated international efforts absolutely essential, it said, adding that this includes harmonising regulations, sharing intelligence and conducting joint operations.
Collaboration between the public and private sectors to share information and best practices for combating money laundering should also be encouraged, it added.

 

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Crypto firm Terraform and Do Kwon to pay $6 billion to settle SEC fraud case​

Do Kwon's Terraform Labs collapsed in 2022, wiping out US$40 billion in investor assets and shaking the cryptocurrency world. PHOTO: REUTERS
Updated

Jun 13, 2024

NEW YORK - Terraform Labs and its co-founder Do Kwon will pay US$4.47 billion (S$6 billion) to resolve a US Securities and Exchange Commission (SEC) lawsuit over the company’s 2022 collapse, which wiped out US$40 billion in investor assets and shook the cryptocurrency world.
The SEC on June 12 asked a federal judge in New York to approve the settlement. The deal was reached after a jury in April found Terraform and Kwon liable for fraud following a two-week civil trial. Kwon still faces a criminal case over the sale of the company’s UST stablecoin.
Terraform will pay about US$3.59 billion plus interest and a US$420 million penalty, while Kwon will pay US$204.3 million, including US$110 million in disgorgement, interest and a US$80 million penalty, a court filing showed.
Kwon also must transfer at least US$204.3 million to the Terraform bankruptcy estate for distribution to investors and will be barred from serving as an officer or director of a public company, according to the settlement.
Before the deal was reached, the SEC had been asking US district judge Jed Rakoff to impose a fine of US$5.3 billion, while Terraform argued it should not have to pay because most of its stablecoins were sold overseas.
The resolution also requires Terraform to wind down its business “as soon as possible” and seek approval of a Chapter 11 liquidation plan in its bankruptcy case that replaces company directors, including current chief executive Chris Amani, and appoints a trustee or estate representative to use its remaining assets to pay creditors and investors.
“The entry of this judgment would ensure the maximal return of funds to harmed investors and put Terraform out of business for good,” the SEC said in a letter to Mr Rakoff.

Mr David Kornblau, a lawyer for Terraform, declined to comment.
Jurors found Terraform and Kwon, a South Korean, liable for fraud in falsely claiming that Chai, a popular Korean payment application, was using Terraform’s blockchain technology to make transactions.
The jurors also found investors were misled about the stability of the UST stablecoin, which Kwon and Terraform claimed was algorithmically pegged to the US dollar.
Kwon, who owns 92 per cent of Terraform, was arrested in Montenegro in 2023 and convicted there of attempting to travel using a fake passport.
Since then, the disgraced former crypto mogul has been caught in an institutional tug-of-war in Montenegro while officials fight over whether he should be extradited to the US or South Korea. BLOOMBERG

 

[k1976]

Crypto firm Terraform and Do Kwon to pay $6 billion to settle SEC fraud case​

Do Kwon's Terraform Labs collapsed in 2022, wiping out US$40 billion in investor assets and shaking the cryptocurrency world. PHOTO: REUTERS
Updated

Jun 13, 2024

NEW YORK - Terraform Labs and its co-founder Do Kwon will pay US$4.47 billion (S$6 billion) to resolve a US Securities and Exchange Commission (SEC) lawsuit over the company’s 2022 collapse, which wiped out US$40 billion in investor assets and shook the cryptocurrency world.
The SEC on June 12 asked a federal judge in New York to approve the settlement. The deal was reached after a jury in April found Terraform and Kwon liable for fraud following a two-week civil trial. Kwon still faces a criminal case over the sale of the company’s UST stablecoin.
Terraform will pay about US$3.59 billion plus interest and a US$420 million penalty, while Kwon will pay US$204.3 million, including US$110 million in disgorgement, interest and a US$80 million penalty, a court filing showed.
Kwon also must transfer at least US$204.3 million to the Terraform bankruptcy estate for distribution to investors and will be barred from serving as an officer or director of a public company, according to the settlement.
Before the deal was reached, the SEC had been asking US district judge Jed Rakoff to impose a fine of US$5.3 billion, while Terraform argued it should not have to pay because most of its stablecoins were sold overseas.
The resolution also requires Terraform to wind down its business “as soon as possible” and seek approval of a Chapter 11 liquidation plan in its bankruptcy case that replaces company directors, including current chief executive Chris Amani, and appoints a trustee or estate representative to use its remaining assets to pay creditors and investors.
“The entry of this judgment would ensure the maximal return of funds to harmed investors and put Terraform out of business for good,” the SEC said in a letter to Mr Rakoff.

Mr David Kornblau, a lawyer for Terraform, declined to comment.
Jurors found Terraform and Kwon, a South Korean, liable for fraud in falsely claiming that Chai, a popular Korean payment application, was using Terraform’s blockchain technology to make transactions.
The jurors also found investors were misled about the stability of the UST stablecoin, which Kwon and Terraform claimed was algorithmically pegged to the US dollar.
Kwon, who owns 92 per cent of Terraform, was arrested in Montenegro in 2023 and convicted there of attempting to travel using a fake passport.
Since then, the disgraced former crypto mogul has been caught in an institutional tug-of-war in Montenegro while officials fight over whether he should be extradited to the US or South Korea. BLOOMBERG

Wow...still can pay 6b de woh
Really is a Big Boss

 

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Jail for man who helped friend cheat another man of $300,000​

Andrew Wong

Jun 14, 2024

SINGAPORE – To settle his personal debts, a man agreed to help carry out his friend’s plan to cheat someone else of $300,000.
Koh You Ming later used his share of the money to settle his debts of about $35,000.
On June 14, the 37-year-old was sentenced to one year and four months’ jail after pleading guilty to one cheating charge.
He has not made any restitution to the victim.
Koh and Phoon Chee Kong, 37, knew each other from cryptocurrency trading, and the victim, 27, became acquainted with Phoon some time between 2020 and May 2024.
All three were members of the same cryptocurrency trading group on messaging platform Telegram where members can send messages to the chat to indicate their interest in purchasing the digital currencies.
Brokers or members who can help to facilitate the transactions respond to the messages privately.

Between 2020 and May 2024, Phoon helped the victim on 10 separate occasions to purchase the cryptocurrency Tether, also known as USDT.
Under the arrangement, they would both agree on the currency exchange rate that was to be used and the amount of USDT to be bought. The digital currency was purchased in US dollars.
The victim would then meet either Phoon or Koh to hand them the money, and Phoon would transfer the USDT to the victim’s digital wallet.

The court heard that Phoon cooked up a plan to “run” with the victim’s money some time in May 2021. He had alerted Koh to his plan, and Koh agreed to help in exchange for a cut of the money.
On May 24, 2021, the victim messaged the group chat saying that he wanted to buy $300,000 worth of USDT, and Phoon responded to say he could assist with the trade.
After the pair agreed on the transaction, Phoon called Koh to inform him of the deal, and they decided to cheat the victim.
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Phoon then called the victim and asked him to meet Koh on the same day to pass him the $300,000 in person, similar to their previous arrangements.
Upon receiving the money, Koh met Phoon at a different location to ensure they were out of sight of closed-circuit television cameras.
They agreed to a 60-40 split, with Koh getting the smaller cut.
As part of the act, Phoon called the victim at around 3.40pm the same day to inform him that he was unable to contact Koh and thus would not be transferring the cryptocurrency.
The victim then made a police report.
Investigations found that the pair had made plans to conceal the money.
In a bid to cover their tracks, Phoon used his share to buy $180,000 worth of USDT before transferring the entire purchase into Koh’s brother’s digital wallet.
Phoon and Koh then transferred the USDT into different wallets before eventually transferring the entire sum into a wallet under Phoon’s name.
Koh, who had received $120,000, used $35,000 to pay off his debts. He gave his brother $5,000, before hiding the rest of the money in his home.
Those found guilty of cheating can be jailed for up to 10 years and fined.
Court documents did not reveal if Phoon has been dealt with.

 

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When crypto scammers use fake identities and send press releases​

More fraudsters are likely using chatbots like ChatGPT to write their website language and the white papers that explain their project. ST PHOTO: GAVIN FOO

Jul 13, 2024

When Jakob-Moritz Eberl clicked on a link to the website of a crypto company, he was stunned at what he saw: His own face looking back at him.
His headshot was displayed under the name “Mason Jones” and the title “Senior Blockchain Engineer” as one of six men the site claimed were on the team behind InfinityStakeChain. A near-duplicate website for a platform called FlexyStakes used the same photos above different names, identifying Dr Eberl as “Noel Brennan”.
Dr Eberl, a social scientist at the University of Vienna who does not even own any crypto, had no idea why his picture was used by scammers on fake sites.
Such fraudsters have attempted to feign legitimacy with false press releases about venture capital fund raises and bogus claims about partnerships with industry giants. In some cases, the false information has leaked into trusted industry data sources.
Both InfinityStakeChain and FlexyStakes issued press releases that were published on wire services, local news sites and Yahoo! Finance claiming that they had raised US$12 million (S$16 million) from investors led by Binance, the world’s largest crypto exchange.
On their websites, they also claimed to have partnerships with other big names in the industry, including Polygon, Avalanche, dydx and Fantom. Binance and the others have each confirmed to Bloomberg that they had never worked with either of these start-ups.
In a sector where venture capital (VC) activity is closely watched by traders hunting for signals about which tokens to buy, an investment from big names like Andreessen Horowitz or Dragonfly could inspire traders to snap up a new project’s token and boost its price.

With Bitcoin and other tokens surging upward in 2024 and VC funding rebounding, the risk is high for both retail and institutional investors looking to take advantage of the market’s resurgence. “It’s fraud, especially if you’re putting up these websites,” said PitchBook crypto analyst Robert Le, who identified InfinityStakeChain and FlexyStakes among a group of crypto start-ups peddling false information about fund raising.
Inquiries to the two projects from Bloomberg went unanswered. InfinityStakeChain and FlexyStakes both used the same promotional language and listed the same partners on their websites, though InfinityStakeChain’s site became inactive in the past month. They even claimed the same office address at a quiet commercial property in Melbourne, Australia.
The six-level office building is home to an empty first floor full of abandoned desks, some shipping companies, a medical centre and a construction office, but there is no sign of FlexyStakes or InfinityStakeChain. A receptionist for one of the building’s tenants said that, to her knowledge, no company with either of the two names had rented space there in the past two years.

Fake crypto fund raising​

Another case of crypto-VC misinformation was on display recently with a company called Candle Labs. Multiple data and news platforms including Crunchbase, PitchBook and Silicon Valley Journals incorrectly reported that the company had raised US$48 million in a Series B, or later-stage, venture funding round.
Mr Sam Safahi, 21, founded the crypto start-up in 2022 alongside some friends and his father, Alan Safahi. The elder Safahi, who had previously served on the board of Ripple Labs, is now serving a 40-month sentence in federal prison for fraud and money laundering convictions related to a US$2.7 million prepaid debit card scam.
The younger Mr Safahi said in an interview that the company did not raise US$48 million and he was unsure how that information circulated. “We raised US$1.2 million, mostly from family or friends,” he said.
Silicon Valley Journals said in an e-mail to Bloomberg that it had got the information from Crunchbase and subsequently updated the article on Candle Labs’ fund raise to include an attribution to Crunchbase. Crunchbase has an article referencing a US$48 million fund raise, as well as a US$1,000 fund raise listed on the company’s data page. The Candle Labs data page also had a line that read: “This is a fraudulent start-up – if you receive a recruitment offer from these guys ignore it.”
With so much misinformation afoot, PitchBook has had to change how it tracks the crypto industry, Mr Le said. When a funding round is announced, Mr Le often will speak directly to the listed investors, the firms’ limited partners and the founders themselves to confirm that they are all involved. He also often corroborates the fund raise using government filings, if they are available. “We take more of a grain of salt in the crypto space for a fund-raise announcement than in the traditional VC space,” he said.
There’s a new wrinkle in his efforts to combat misinformation: Artificial intelligence (AI) is making it more difficult to detect what’s real and what’s not. More fraudsters are likely using chatbots like ChatGPT to write their website language and the white papers that explain their project, Mr Le said, and the result is that scam projects come off as more polished than they did in the past.

Bots and humans​

Social media is another complicating factor when it comes to the spread of misinformation online, Mr Le noted. He said that there are bots that execute crypto trades based on news and social media posts, which means that false information can artificially boost token prices.
And it is not just bots falling for it. Actual humans are particularly vulnerable when it comes to financial information and there are few safeguards on social media sites to prevent falsehoods from spreading, said Ms Svitlana Volkova, chief AI scientist at engineering services firm Aptima, whose research has focused on crypto misinformation.
“People share information without prior verification and it’s being reshared and it gets viral,” she said. The misinformation poses a risk not just to crypto traders, but also to venture capitalists themselves.
VC firms in the crypto space have been criticised for not conducting enough due diligence and ultimately backing fraudulent start-ups like FTX. It is common for crypto founders to stretch the truth, said Mr Roger Royse, partner at law firm Haynes Boone.

Suspension of reality​

“Here in Silicon Valley, it’s kind of the nature of being a start-up founder, that people have a lot of hubris that borders on a suspension of reality,” Mr Royse said. The question of how far start-up founders can go when it comes to self-aggrandisement has been brought up in cases such as the one against Elizabeth Holmes and her blood-testing start-up Theranos.
While founders may believe they have the potential to succeed on a high level, Mr Royse said that does not mean they can claim to have accomplished things they haven’t. And publicly lying about a funding round, including the amount raised, and getting other VCs to invest based on that information could pose a legal problem.
“If there’s a misrepresentation of a material fact, and that induces the investor to invest, that is the basis of a fraud claim,” he said.
As for Dr Eberl, the social scientist in Vienna, it is unclear whether he can get his image removed from the FlexyStakes website.
“On some level, I guess I feel violated by the crypto scam,” he said, while adding that his academic curiosity has also been piqued. “I just find it extremely weird and I find this connection extremely intriguing,” he added. BLOOMBERG

 

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Singer Akon’s billion-dollar Wakanda-inspired futuristic city in Senegal gets final notice​

Akon said in 2020 that Akon City would run on solar power and his Akoin cryptocurrency. PHOTOS: AFP, AKON_CITY_SENEGAL/INSTAGRAM

Aug 06, 2024

DAKAR – A single arched concrete block juts out of a field in Senegal, where R&B singer Akon laid the foundation stone for his US$6 billion (S$7.95 billion) metropolis four years ago.
The West African nation granted the music artiste 55ha of land on its Atlantic coast in 2020 to build his Akon City – envisioned as a real-life Wakanda, the fictional country from Marvel Studios’ Black Panther films (2018 and 2022).
Complete with condominiums, amusement parks and a seaside resort in gravity-defying skyscrapers rising above the rural landscape, Akon City would run on solar power and his Akoin cryptocurrency, the American-Senegalese singer said in 2020, during a flashy presentation in Senegal’s capital of Dakar.
Today, goats and cows graze the deserted pasture 96km south of Dakar, and the authorities are growing increasingly impatient.
Sapco-Senegal, the state-owned entity charged with developing the country’s coastal and tourism areas, has given Akon formal notice to start work on his project, or the government will take back 90 per cent of the land granted to him, general manager Serigne Mboup said.
Akon, 51, got the notice after missing several payments to Sapco, two people familiar with the matter said.
A spokesperson for the singer declined to comment. A member of his staff said he was not aware of any notice when reached by phone. Sapco declined to answer further questions.

Besides the luxury apartments and seaside resort, Akon also envisioned hospitals, a police station and a university equipped with cutting-edge technology.
Akon City was to be environmentally friendly, the artiste said in 2020, and residents and visitors would use Akoin cryptocurrency launched that year.
Akoin – introduced during the peak of a cryptocurrency bull run in November 2020 – is now hardly traded, if at all. The Bitget crypto exchange first quoted it at US$0.15 on Nov 19, 2020, and it had dwindled to US$0.003 by Dec 11, 2023, the last available price.

Local authorities were open to Akon’s promises to attract businesses and create jobs in an economically deprived, mostly agrarian part of Senegal.
“Akon City would bring employment for our youth,” Mbodiene village chief Michel Diome said. “We would finally have a hospital and even a university.”
Akon was born in the US and spent his early childhood in Senegal before moving to New Jersey, where he discovered his passion for music.
Born Aliaune Thiam, he rose to prominence with the release of his 2004 debut album, Trouble.
He has had 37 songs on the Billboard Hot 100 – including Locked Up (2004), Lonely (2005) and Smack That (2006) – some of which include collaborations with the likes of stars Lady Gaga, Snoop Dogg, Eminem and Gwen Stefani, and sold more than 35 million albums globally.
“I was always thinking, the day I get big, or the day I can be of an influence or have some kind of power to make decisions in Africa, I want to go in and start developing,” he told CNN in 2020.
In 2007, Akon founded Akon Lighting Africa, with the goal to distribute solar-powered solutions to off-grid parts of the continent. Akon City was his boldest idea yet, and required getting former Senegalese president Macky Sall on board.
With a 10-year construction plan, the first phase of the project – including the hospital, condos and an “African village” – was set to be completed by 2023.
“By phase one, we’ll be able to welcome visitors into the city,” Akon told CNN in 2020. He later said the Covid-19 pandemic pushed the ambitious deadline forward.

Construction on Akon City in Senegal had not even started when the singer revealed plans to build a second city in Uganda.
Mr Yoweri Museveni, president of the East African country since 1986, allocated 2.6 sq km of land to Akon in 2021.
So far, preliminary work is pending “because occupants resisted the move and sent away surveyors”, Uganda Land Commission Secretary Andrew Nyumba said by phone from the capital, Kampala.
Uganda will hand the land to the developer after the occupants are compensated, and the payments can start only from July 2025 because the government did not budget for them in the current financial year, Mr Nyumba said.
Back in Senegal, residents say they have not been reimbursed for the land given to Akon that they relinquished to Sapco in 2009. Questions about financing and feasibility remain unanswered and locals are wondering whether the promised benefits will ever come.
So far, the singer has financed the construction of a youth centre and a basketball court in Mbodiene and an information centre for visitors curious about Akon City. But nothing resembling the futuristic blueprints he unveiled in 2020 has been built.
“Akon City is a scandal,” lawmaker Bara Gaye told Parliament in February 2023. “What is the government waiting for to end his contract?”
Still, Mr Cheick Seck, a project manager with Dakar-based Axiome Construction, said that works in Mbodiene are moving ahead.
“Akon City is happening,” he added. “We’re just waiting for instructions on how to proceed.”
Geotechnical studies, clearing of brush and an inventory of protected plant species on part of the land are under way, according to a statement shared by Akon’s Dakar-based partners with local media in late 2023.
The singer is expected in Senegal’s capital in the coming weeks to reassure partners of the project’s viability, his team said.
Once a fierce believer in Akon’s plans for his community, Mbodiene village chief Diome said his hopes that the singer would transform his community were dwindling.
“We’re still waiting,” he said. BLOOMBERG

 

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Jail and fine for mastermind of cryptocurrency investment scam where victims lost $1.1m​

Shaffiq Alkhatib
Court Correspondent

Aug 26, 2024

SINGAPORE – A mastermind of an elaborate scam ran a firm offering cryptocurrency investment schemes, in which 12 investors parted with more than $1.8 million in total.
In reality, the company, identified as A&A Blockchain Innovation, was operating a Ponzi scheme with no actual profit-generating business, and some investors were paid “returns” with money from the other investors.
Multiple investors did not receive such “returns” and lost a total of around $1.1 million.
On Aug 26, Dutch national Yang Bin, who operated A&A without a valid work pass and recruited foreigners to work for it without similar documents, was sentenced to six years’ jail and a fine of $16,000.
He will spend an additional 40 days behind bars if he fails to fork out the fine amount.
Yang, who has made no restitution, had pleaded guilty to six cheating charges and two charges relating to the employment of foreigners. Eleven other charges were considered during sentencing.
On Aug 26, Deputy Public Prosecutor Wong Shiau Yin told the court that between May 2021 and February 2022, A&A attracted investments from more than 700 parties in Singapore, amounting to around $6.7 million.

Court documents did not disclose if these 700 investors were linked to Yang’s cheating offences.
Yang was the second person involved in the scam to be dealt with in court. Chinese national Wang Xinghong, 40, pleaded guilty to six cheating charges and was sentenced to five years’ jail on Aug 6.
These cases involving two other Chinese nationals – Chen Wei, 43, and Lu Huangbin, 60 – are pending.

At the time of the offences, Yang was the chairman of A&A, which was incorporated on April 20, 2021.
The DPP said that Yang had engaged Lu, Chen and Wang to join the firm. She added that Yang was the overall person in charge of A&A, while the trio reported to him.
Between May 20 that year and Feb 15, 2022, the firm offered the “A&A chain mining scheme” to investors in Singapore.
Under this scheme, A&A promised investors a fixed daily return of 0.5 per cent on their investments, which would purportedly be derived from the mining of cryptocurrencies.

In its marketing materials to investors, which included promotional videos, A&A claimed it had entered into an agreement with a firm called Yunnan Shun Ai Yun Xun Investment Holdings to acquire 70 per cent ownership of 300,000 mining machines in China, which could mine cryptocurrencies such as Bitcoin and Ethereum.
A&A claimed it would generate the revenue for returns through the mining of cryptocurrency by using these machines.
In addition, the company developed an app that investors could use to purchase A&A “tokens” to invest in the mining scheme.
Crypto platform Coinbase describes mining as the process that several cryptocurrencies use to generate new coins and verify new transactions.
DPP Wong said: “In reality, A&A did not enter into an agreement with Yunnan Holdings to acquire 70 per cent ownership of 300,000 mining machines. In fact, A&A did not mine cryptocurrency to generate revenue.”
Yang had engaged Wang to develop the app, where investors could monitor their purported 0.5 per cent daily returns.
In earlier proceedings, the court heard that the app was a centralised software where system managers based in China could input random numbers to falsely reflect investor returns.
Court documents stated that Yang had directed Chen to collect cash from various investors. Yang then used the money for his personal expenses.
Yang had also come up with the false representation that A&A owned 300,000 physical mining machines in Yunnan.

“He tasked Lu, whom he had placed in charge of marketing, to spread this false representation to investors at A&A marketing events,” said the DPP.
Separately, she told the court that Yang entered Singapore on a social visit pass on or around April 8, 2021.
He later ran A&A without a valid work pass until around Feb 15, 2022. The company also employed Lu as its chief executive, even though he did not have a similar document.
Yang was arrested on Aug 16, 2023, and has been in remand since. The authorities managed to seize $100,000 from his home, which he admitted belonged to A&A’s investors.

 

[LITTLEREDDOT]

Jail for ‘glorified secretary’ who facilitated crypto Ponzi scheme that scammed victims of $1.1m​

Chinese national Chen Wei, 43, pleaded guilty to six cheating charges and one charge of not having a valid work pass. PHOTO: KELVIN CHNG

David Sun
Crime Correspondent

Sep 12, 2024

SINGAPORE – In name, he was the registered director of the company, but in practice, he was a “glorified secretary” and the personal assistant to the chairman.
Nonetheless, Chen Wei, 43, was a key cog in an elaborate cryptocurrency investment scam that cheated victims of $1.1 million.
On Sept 11, the Chinese national was sentenced to four years’ jail and fined $6,000 after pleading guilty to six charges of cheating and one charge of not having a valid work pass.
Another eight similar charges were taken into consideration for sentencing.
He will have to serve another 20 days in jail if the fine is not paid.
Chen was the director of A&A Blockchain Technology Innovation, and reported to Dutch national Yang Bin, 61, the company’s chairman and mastermind of the scheme.
The company offered an investment scheme to retail investors, claiming to have 300,000 physical mining machines that could mine cryptocurrency to generate revenue.

But the company did not have such machines and it was all a Ponzi scheme, along with a fake app where investors could monitor their purported 0.5 per cent daily returns.
The app was actually a centralised software program where system managers based in China could input random numbers to falsely reflect investor returns.
A&A was incorporated in April 2021, after which it began offering the A&A Chain Mining Scheme to investors in Singapore.
Between May 2021 and February 2022, the company attracted investments from more than 700 investors in Singapore, amounting to about $6.7 million.
Because it was a Ponzi scheme, some of the investors were paid returns using monies from newer investors.
When the scheme was uncovered, the losses suffered by investors amounted to about $1.1 million.
Yang was jailed for six years and fined $16,000 on Aug 26 after pleading guilty to six cheating charges and two charges relating to the employment of foreigners. Eleven other charges were considered during sentencing.
On Sept 11, Chen’s lawyer Gary Low told the court his client’s role was “highly administrative” and that he was Yang’s “glorified secretary” who did only what he was instructed to do.
Deputy Public Prosecutor Wong Shiau Yin said Chen was certainly not the mastermind, but this did not detract from the role and function he played in the whole scheme, having been the one to collect the cash from investors.
For each count of cheating, he could have been jailed for up to 10 years, on top of a fine.

 

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Singapore-based crypto firm Terraform Labs gets approval for bankruptcy wind-down​

Co-founder Do Kwon was charged with defrauding investors, including Singaporeans, who lost US$40 billion when its TerraUSD and Luna tokens collapsed. PHOTO: AFP

Sep 20, 2024

NEW YORK - Terraform Labs received court approval on Sept 19 to wind down its operations in bankruptcy after agreeing to settle a US Securities and Exchange Commission (SEC) lawsuit.
The lawsuit accused the Singapore-incorporated company of defrauding cryptocurrency investors, including Singaporeans, who lost an estimated US$40 billion (S$51.7 billion) when its TerraUSD and Luna tokens collapsed in 2022.
US Bankruptcy Judge Brendan Shannon approved Terraform’s bankruptcy plan at a hearing in Wilmington, Delaware, calling it a “welcome alternative” to further litigation over the investor losses.
Terraform, which filed for bankruptcy in January, agreed to a US$4.47 billion SEC settlement after a jury in Manhattan found the company liable in April for defrauding investors.
The SEC will collect little, if anything, on that settlement amount because it agreed to be paid only after Terraform satisfies crypto loss claims as part of its bankruptcy wind-down. The company said it is currently “impossible to estimate” the total value of crypto losses that will be eligible to be paid during the liquidation.
Terraform estimated that it will be able to pay between US$184.5 million and US$442.2 million to crypto purchasers and other stakeholders as part of its bankruptcy liquidation.
The SEC had accused Terraform and its founder Do Kwon of deceiving investors about the stability of TerraUSD, a stablecoin he designed to maintain a constant US$1 price, and falsely claiming that Terraform’s blockchain was used in a popular South Korean mobile payment app.

A jury found Kwon and Terraform Labs liable on civil fraud charges at trial, and Kwon and Terraform decided to settle with the SEC before a second phase of the trial that would have determined the amount of damages.
Kwon faces related criminal charges both in the United States and his native South Korea. He has denied wrongdoing.
TerraUSD and the closely linked Luna, a more traditional token that Kwon also designed, collapsed in May 2022 when TerraUSD was unable to maintain its peg to the US dollar.
The collapse of the two cryptocurrencies caused a market crash that triggered a wave of bankruptcies in the crypto industry. REUTERS

 

[LITTLEREDDOT]

Crypto Exchange BingX Vows to Compensate Users After $43M Hack​

HackPeckShieldSingapore
PeckShield reported the breach resulted in a $43M loss, with most stolen assets quickly converted to ETH and BNB.

Crypto Reporter
Shalini Nagarajan

Last updated:
September 20, 2024

Singapore-based crypto exchange BingX on Friday confirmed a security breach after observing numerous “suspicious” outflows from one of its hot wallets online. Consequently, the exchange promised to compensate users for the losses.

The team announced via an X post that it had detected abnormal access to the hot wallet, suspecting it to be a hacker attack. “We immediately initiated an emergency response, including asset transfers and pausing withdrawals,” it said.

BingX further clarified that the losses encountered were minor and they were managing the situation. Additionally, they assured that the majority of assets are secure in cold wallets, while only a small fraction was impacted in the hot wallet.

PeckShield Confirms $43M BingX Hack, Exchange Freezes Withdrawals for 24-Hour Security Check​

However, blockchain security firm PeckShield reported that the security breach actually led to a $43m loss, primarily involving Ethereum and BNB Chain. At first, the firm had pegged the number to be around $26m.

PeckShield observed that the hacker swiftly exchanged the majority of the pilfered assets for about 4,526 $ETH and 7,864.7 $BNB. As of its last update, the stolen funds totaled 5.3K ETH, 4.1K BNB and 1.65M MATIC.

Vivien Lin, BingX’s chief product officer, said that the exchange has temporarily suspended withdrawals to enhance security. During this time, the team is performing an emergency inspection. She added that withdrawals would resume no later than within 24 hours.

“We are working on a compensation plan, which will be announced soon,” she added.

Crypto Exchanges Face Security Crisis​

The crypto exchange sector faced significant security challenges recently, with two other notable incidents highlighting the vulnerabilities within these platforms.

Crypto exchange Indodax encountered its own ordeal last week, where hackers pilfered around $22m in digital assets.

Meanwhile, WazirX, a well-known exchange in India, suffered a substantial loss, with attackers orchestrating a series of dubious transactions that siphoned off $234m from the platform.

 

[Patriotmissile]

Those people who bought virtual real estates can live there after they become virtual (dead).

 

[mahjongking]

all these scammers should be treated as armed robbery, bullet to the head if caught. period
watch netflix equaliser 3, final scene when the innocent scammed victim got back his life savings was touching