The US financial policeman accuses 11 people of organizing a massive cryptocurrency scam. Baptized Forsage, the project is based on a completely classic Ponzi pyramid. With this system, they raised $ 300 million from thousands of investors around the world.
The Securities and Exchange Commission (SEC), the federal authority charged with overseeing the American financial markets, has justindict 11 people accused of creating a vast cryptocurrency scam.
In a press release published on Monday, August 1, 2022, the federal agency points to a crypto platform titled Drilling. Launched in January 2020, the Forsage.io website allows investors to do so “ execute transactions via smart contracts running on the Ethereum blockchain “. Trading via the Tron and Binance Smart Chain networks is also offered.
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Ponzi schemes and aggressive social media ads
According to the SEC investigation, Forsage is reliant a Ponzi scheme. In a pyramid scheme, investors make money by bringing in new members. Older members are remunerated from the assets deposited by new investors. As the SEC explains, Forsage has “ used the assets of new investors to pay previous investors “.
” Forsage is a large scale fraudulent pyramid scheme launched and aggressively marketed to investors “says Carolyn Welshhans, acting head of the SEC’s cryptography unit.
On its website, Forsage states in fact entrance tickets Internet users who wish to join the community. The cost varies from 10 euros to about 75 dollars in Ether. Once the investor has paid the registration fee, he will be able to reap profits by attracting other users. To join the site, the Internet user must necessarily go through a reference link.
” Receive a reward as soon as a new partner joins your team. To do this, you need to invite new partners and grow your team. Use your referral link for this “details the Forsage support service, pointing out that the income received ” they depend on individual efforts and the performance of your team “.
The helpdesk says it is impossible to lose money with Forsage, because profits do not depend on the price of cryptocurrencies. The growth of the platform is therefore based exclusively on the assets entered by new entrants. This is the essence of a Ponzi scheme.
To promote the website, the administrators have has published numerous announcements on social networks. However, most platforms have taken steps to stem the influx of ads promoting the cryptocurrency. This is particularly the case with TikTok, which banned such ads in July 2021, and Twitter, which tightened the screw in 2018.
For its part, Facebook has long since banned ads related to cryptocurrencies. Despite everything, the social network continued to swarm with ads that evoke digital assets in half words. Note that the ban was finally lifted last year. From now on, ads dedicated to crypto services are allowed on Facebook.
Indicted the four founders
Through aggressive promotional campaigns, Forsage was able to increase over $ 300 million. Millions of retail investors around the world, including the United States, have trusted the platform, the SEC said. The team clarifies, however, that Forsage ” never holds the money of any of its participants “. The injected funds are managed in a decentralized way by smart contracts implemented on the blockchains.
” As the system is decentralized, nobody checks your winnings. You are responsible for it yourself and only you can decide how fast you want to win “details the assistance service.
This was announced by the American financial control indicted the four founders of Forsage, namely Vladimir Okhotnikov, Jane Doe alias Lola Ferrari, Mikhail Sergeev and Sergey Maslakov. For the moment, the authorities do not know where these individuals are. According to the SEC, the founders reside in Russia, Georgia and Indonesia.
The US authority is also indicting several Forsage promoters, including three people living in the United States. Two of the promoters agreed to settle the charges. Contacted by us, the Forsage team denies rely on a pyramid system.
” We are a decentralized system that does not obey any regulator on this planet “vigorously declares a team member, believing the SEC complaint to be ” great free advertising for Forsage “.
We also asked the team for information how Forsage executives generate revenue. According to the public, admins earn the same as all members … by recruiting other users.