For Thomas, a finance professional, that put him squarely in the sights of a sophisticated new crypto scam that left him more than £300,000 out of pocket. It’s all possible because of the unexpected way his story began. It turned out this friend had started using a crypto trading app that was said to be American. My friend was right – it’s an amazing tool. The Ponzi allegedly operates a complex scheme using artificial intelligence (AI) bots to exploit arbitrage opportunities across multiple cryptocurrency exchanges. This blueprint guaranteed to deliver large dividends via the exchange of electronic currencies.
Initially, Thomas was ecstatic to find out that he had been “lucky” enough to be selected for a large airdrop of $400,000. Little did he know, though, that he’d actually signed up for a $200,000 airdrop instead. To unfreeze his balance, Thomas was informed that he would have to put down an extra 20% of the money. But as the tide turned against their fortunes, he was soon greeted with disturbing news. The International Monetary Fund (IMF) had reportedly blocked his funds out of concern that the cash may have originated from illicit activity.
“I was told I had been ‘lucky’ to be selected for an increased airdrop at $400,000, with even greater rewards for participating. This was done without any sort of permission from myself,” – Thomas
Desperate to recover his investment, Thomas took out an additional $40,000 loan to cover the new deposit threshold. In the end, none of his good work mattered because the funds were never available to be spent. Instead of succumbing to the scam, he fought back by reporting the fraud. He reported it to the FBI here in the United States and National Crime Agency in Great Britain.
“At this point I really smelled this to be a scam, and I started to realise how powerless I was … I should have stopped here, but whether it was my stubbornness, my curiosity to see how this ends or just blind faith that I would get my cash back, I did everything I could to top up the additional $200,000. This involved using all remaining savings I had, as well as borrowing from my mortgage and work,” – Thomas
The app proudly boasts that it’s made a deal with one of the world’s most famous crypto exchanges. This collaboration provides greater legitimacy to its work. Thomas successfully received the airdrop and clicked the “withdraw” button on his app with excitement. Then he ran into a second complication when customer support alerted him to a new problem.
“Except the money didn’t come back to my wallet,” – Thomas
During this entire process, Thomas’s monetary damages continued to increase exponentially. In total, he lost more than £300,000. To offset it he re-mortgaged and took a loan of £20,000 from his employer. The app’s business model was an astounding fortune-making scheme, guaranteeing daily profits averaging ~1% with 0% loss-making days. Sadly, this charm just plunged him farther into his monetary despair.
“Over the next couple of months the account accrued profits at approximately 1% a day. There were never any loss-making days …” – Thomas
Determined to seek justice, Thomas has reported the scam to various authorities and taken his case to the UK’s Financial Ombudsman Service. He wants his experience to be a warning to others about making similar investments in dogecoin or other cryptocurrency.
“It’s a bit like telling someone your bank account details and saying ‘Go and make money out of my bank account.’” – Thomas
The Financial Conduct Authority has been persisting in attempting to warn investors of the risks involved with buying crypto assets. They caution that people should only invest money they can afford to lose and approach these very high-risk enterprises.
“continues to remind people that purchasing crypto assets remains high-risk and that they should be prepared to lose all their money” – The Financial Conduct Authority