The US Department of Justice (DOJ) has recently charged a Nevada man for his involvement in the much-talked-about CoinDeal investment scheme. According to the DOJ, Bryan Lee conspired with CoinDeal leader Neil Chandran, deceiving 10,000 investors and extracting around $45 million from them.
Customers were led to invest in companies controlled by Chandran under the pretense of these companies being on the verge of acquisition by wealthy buyers, in exchange for extremely high returns. As part of the scheme, Lee is allegedly the nominee owner and director of ViMarket, which claims to be working on VR and “metaverse” technologies along with an associated cryptocurrency.
The federal agency maintained that Lee, following Chandran’s orders, deposited investor funds into ViMarket’s bank accounts. Astonishingly, both Chandran and Lee allegedly misused millions of dollars of investor funds on luxury cars and real estate. Lee is now facing multiple charges including conspiracy, mail fraud, wire fraud, and engaging in monetary transactions in criminally derived property. If convicted, he could be sentenced to 110 years in prison.
It’s important to note that Lee’s guilt has not yet been established, and he will soon make his first appearance in court. This case follows the Securities and Exchange Commission (SEC) charging five individuals and three companies linked to CoinDeal earlier this year.
The growing cryptocurrency market has been accompanied by a significant increase in scams and hacks targeting unsuspecting victims. For instance, “Inferno Drainer,” a scam-as-a-service company, has reportedly drained approximately $6 million worth of crypto assets from users since the beginning of the year. Moreover, fake airdrops have allowed crypto scammers to obtain around 3,234 ETH (equivalent to over $6 million) between August 2022 and May.
A staggering $4 billion worth of digital assets was lost to hacks, fraud, scams, and rug pulls in the crypto industry last year. While hacks were responsible for the majority of these losses, other forms of illegal activities like scams and frauds persistently evolved, impacting more victims.
Some scams have even exploited the World Cup Qatar 2022 program, launching phishing websites worldwide to steal user identification and banking data. As the market expands, industry practitioners must take effective measures to minimize risks and protect investors from the mounting threats posed by scams and hacks.
Source: Cryptonews
