According to a press release published by the Federal Trade Commission (FTC) on Wednesday, the agency will send over $470,000 in payments to people who lost money in deceitful chain referral schemes involving cryptocurrencies. The FTC’s complaint alleged that three defendants, Thomas Dluca, Louis Gatto, and Eric Pinkston, promoted unlawful schemes known as Bitcoin Funding Team and My7Network. They reportedly did so via websites, YouTube videos, social media, and conference calls.

The FTC stated that the defendants’ schemes promised big returns for small cryptocurrency, bitcoin or Litecoin, payments. To lure participants in, the defendants claimed that their platform could transform a payment of just over $100 into $80,000 in monthly income. Scheme participants could only generate revenue by recruiting new participants and convincing them to also submit cryptocurrency payments, however.

For example, the FTC explained, Bitcoin Funding Team worked by requiring participants to make an initial bitcoin payment to an earlier participant and in addition to a fee. After the initial investment, participants were eligible to recruit new members and receive those new members’ payments. Reportedly, Bitcoin Funding Team asserted that participants could earn bigger rewards if they forked over more money.

According to the FTC, however, few participants recouped their investments. In March, the FTC asked a federal court to stop the schemes after gathering evidence that the schemes were designed to and did enrich those at the top at the expense of everyone else, in violation of the FTC Act. The court agreed to do so and halted the scam artists’ crypto-styled money-making schemes.

At the request of the FTC, the court issued a temporary restraining order and froze the defendants’ assets pending trial. Now, and as part of the settlement, the FTC will send 7,964 refunds through PayPal beginning on Nov. 5. The average refund is approximately $59, the press release stated.

(Excerpt) Read more Here | 2020-11-05 11:19:00
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