A court in Ningbo, China has sentenced three men to prison for a Bitcoin scam which made profits of 150,000 Yuan (21,786 US dollars), after duping clients on Wechat.
After a successful run, the three members ended up being arrested on September 29th of last year, in Zhejiang province. The three men on trial were found guilty. They were all sentenced to at least three years each and ordered to pay a hefty fine.
How did the scam work?
At the start of April 2018, the three men only referred to by their second names, Liu, Chen and Mao created the website server “BTC Club”. This was quickly posted as an official account on Wechat and other social networks.
The scam involved duping their victims into investing into certain coins or other crypto entities, after pretending they were investors looking to give new users the opportunity to learn about Bitcoin and useful tips.
The three individuals each had their own roles in the scam. Liu was responsible for the promotion and pulling in the victims into the Wechat platform and then the group message. Chen then gave instructions to recharge with the Bitcoin in order to understand more on profits. Mao also claimed to be a big investor who posted false investment advice as well as dubious profit margins.
Jinse interviewed Ms. Ning Hai Cui who was a victim of the scam in 2018. After being pulled into the group, Cui said, “The instructor will provide profit orders in the group every day, and issue instructions to let us investors follow him to buy up and sell. Many people often make profit screenshots in the group.”
Seeing the huge money people made, Cui could not resist paying money and buy the Bitcoin through the club, yet when she was unable to withdraw anything, later on, she soon realized that this may be a scam and alerted the authorities.
One of many scams in China
In recent months a major incident that has attracted attention is the Wave Field Super community scam, which used the Tron name and saw many investments from unsuspecting Chinese people. The scandal cause issues for Tron’s Justin Sun and even prompted a mob outside the company’s Beijing office.
In June last year, a Chinese scammer was arrested in Eastern China for a Bitcoin scam, which took 100 million yuan (nearly US$15 million) from 50 investors in three months. Identified as Zhang, the man offered Bitcoin mining machines when they were in high demand at a cut price of 10,000 Yuan (US$1,500), yet never delivered on his promise.
These scams and incidents are probably why Chinese rapper, TCG Yinyang, has sung lyrics that translate as, “fakers are everywhere, I’ll break their legs when I bump into them.” I’m sure many others have that sentiment too.