Crypto Investment ‘Scam’ Defrauds Thousands Of Users

Experts have reportedly identified what appears to be a major cryptocurrency scam that has defrauded people out of substantial sums of money in several countries.

iEarn Bot claims to use artificial intelligence to carry out cryptocurrency investments and provide investors with substantial returns.

It has a significant social media presence and has been promoted by well-known leaders in countries such as Nigeria, Columbia and Romania.

But an organised crime expert told the BBC iEarn Bot operates “similar to a Ponzi scheme”, using incoming investments to pay “returns”.

Celebrity sponsors

Once the scheme has gathered enough funds from a country, withdrawals are halted on one pretext or another, and the people behind iEarn Bot begin promoting it in a different country.

In Romania the app was sponsored by Gabriel Garais, a well-known IT expert, a fact that persuaded dozens of high-profile figures such as government officials and academics to invest, the BBC reported.

But Garais said he too was fooled into investing in the app and lost his savings.

Silvia Tabusca, an organised crime expert with the European Centre for Legal Education and Research, found that the app claimed to have 800,000 customers in Indonesia alone.

‘Ponzi scheme’

“The way people in this company operate is more similar to a Ponzi scheme, than an actual business,” Tabusca said.

The BBC found that the credentials iEarn Bot cites on its website appeared to be false, with its supposed founder and “strategic partners” the Massachussetts Institute of Technology, Huawei and Qualcomm saying they had never heard of the firm.

The company provides no contact information and its Facebook page was used until the end of 2021 to advertise weight-loss products.

The BBC identified a crypto wallet that had received payments from about 13,000 potential victims, profiting nearly $1.3 million (£1m) in less than a year, but was unable to trace where or to whom the money went.

Crypto scams

Experts have warned of proliferating crypto scams in recent years, which more recently have begun to target people using cost-of-living issues.

Last week NatWest limited customers’ transfers to cryptocurrency exchanges in response to the growing risk of scams.