China seizes $8.46 million in cryptocurrency and arrests subjects in connection with a multi-level scam.

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2022-03-01 08:31:55

Police in Gansu province, China announced that they had solved a multi-level fraud case related to the Ripple cryptocurrency.

According to Xinhua News Agency, the police have started investigating Ripple UnionPay Community since March 2021 and have arrested 7 leading suspects. These guys have created an application on the phone to perform fraud and appropriate property. The masterminds initially made the promise that the Ripple UnionPay Community app would automatically generate profits for its members as they solicit new people.

See more information about Ripple coin

To participate in this program and benefit from the promised rewards, investors will have to download the mobile app and register in Ripple. Participants will have to buy crypto assets themselves and then contribute to the fund.

During the police raid, a large amount of Ripple cryptocurrency in cold wallets was seized. It is estimated that the value of this cryptocurrency is up to 8.46 million USD. There are also a lot of machines that serve fraudulent purposes. According to investigators, the scammers are dismantling to get away after attracting up to 47,000 members spread across about 30 provinces.

Multi-level business fraud model in the form of pyramids

These types of scams act as a business model. Instead of providing investment or selling products. Investors pay a certain fee and are promised a commission for each client they invite. When the number of participants is high, paying the commission becomes impossible, and most members cannot make a profit and it is difficult to withdraw capital. The owners of the funds will take the money and run away.

With the development of cryptocurrencies and blockchain, scammers often choose this type to “set traps” and appropriate investors’ assets.
As of June 2021, China has arrested more than 1,100 crypto-related suspects.



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