1. Introduction
Bitcoin, Dogecoin , blockchain, metaverse... I believe you must have heard of these hot words and the wealth myths related to them. Take Bitcoin as an example. In February 2020, the price of Bitcoin exceeded US$10,000 per coin and was close to US$69,000 per coin in September 2021. This high-yield myth of getting rich has stimulated many people and has also become an investment for some people. The rhetoric of fraud is to deceive people into the market with high profits and drain their wealth on the grounds of high risks. In recent years, crimes involving "new investment methods" such as virtual currency and Yuanverse have emerged one after another. This article will briefly introduce common methods and remind investors to be more vigilant.
2. New crimes using virtual currencies
According to relevant statistics, criminal cases involving virtual currencies are increasing year by year. In 2020 alone, there were more than 5,000 public judgment documents, and criminal methods are becoming increasingly complex, involving as many as 13 types of cases. . Among them, the following types of high-risk crime types deserve special attention:
(1) Using virtual currency as a promotional point, through the development of offline, layer upon layer of rebates to attract investment
The organizers use the high value-added of virtual currencies such as Bitcoin as a promotional point, Setting a platform transaction threshold requires investors to use virtual currency to purchase platform "products" before they can enter the transaction, and then requires investors to develop downline investors. Rewards will be given according to the number of downline investors, and rebates will be made layer by layer. This is actually a pyramid scheme.
In 2020, the Ministry of Public Security unified deployment and uncovered the first transnational online pyramid scheme case using virtual currency as the medium. The amount involved was as high as 40 billion yuan, with more than 2 million participants and more than 3,000 hierarchical relationships. This criminal gang has set up a "Plus Token" platform. Investors can obtain membership by paying more than $500 in virtual currency, and the virtual currency paid will be converted into "Plus" coins issued by the platform. Subsequently, corresponding Plus coins will be issued as rewards and rebates according to the investment amount and the number of development offline. Although this project is covered with the appearance of virtual currency investment, in fact it still has the basic characteristics of pyramid schemes such as paying threshold fees and continuously developing offline.
A special reminder is that if the investor is identified as a pyramid scheme participant, the investment will be confiscated and cannot be returned.
(2) In the name of investment and financial management, virtual currencies are sold online and offline to attract investment.
In the name of investment and financial management, the organizers sell various blockchain virtual currencies to the public through online and offline methods to attract investment. The amount of returns is used as bait to attract public investment. For example, the Guangdong High Court heard the case of Hao Lingsheng and Yang Fang, who were guilty of illegally absorbing public deposits. In the name of a film and television company, the two publicly sold the LCC film and television blockchain virtual currency to the public through meetings, training, and offline development. . During this period, the two participated in virtual currency investment promotion conferences as film and television company executives and Hong Kong company directors to promote to the public. At the same time, some investors are provided with bank accounts for payment and the purchase of LCC virtual currency for collection. The amount involved in the case was more than 20 million yuan, and more than 700 people took the initiative to report the case.
(3) In the name of investment and financial management, defrauding customers' trust through various means, luring investors to purchase virtual currencies, and committing fraud.
This type of fraud can be divided into loss-making fraud and non-loss-making fraud based on different fraud methods.
In loss-making fraud, the organizers first gain the trust of investors by pretending to be lecturers and preaching to profitable customers, etc., and induce them to invest in virtual currencies and stocks controlled by the fraud gang. After receiving the investment funds, they manipulate the rise and fall of the money through background manipulation and forgery. Investment losses make investors think they are real losses and voluntarily admit losses, thereby defrauding them of money. For example, the Foshan Intermediate People's Court heard the case of Ling Zhicong and Li Chunting suspected of fraud. In just five months, the criminal gang caused customers to lose more than 1.47 million yuan through back-end manipulation.
In non-loss-making fraud, the fraud methods used by the organizers are relatively obvious. After gaining the trust of customers, they induce investors to invest, and immediately cut off all contact after receiving the investment funds. For example, in the case of He Xiang, Pan Junhui and others suspected of fraud before the Qingyuan Intermediate People's Court, some investors lost more than one million.
(4) Using handling fees as bait to induce others to help criminals launder money
Some virtual currencies can be circulated globally and are highly anonymous and concealed, making them a tool for criminals to launder money. In 2020, the police in Huizhou, Guangdong uncovered the country's first money laundering case using virtual currency, involving more than 3,000 people and a total amount of 120 million yuan. The operators of this platform recruit agents and set up studios, and use members’ collection accounts to provide services for receiving, transferring, and laundering funds for overseas online gambling websites and financial investment fraud platforms. Members have unintentionally participated in money laundering. criminal behavior.
3. New crimes committed using the Metaverse
As Facebook announced that it would transform into the Metaverse Company in the future, the Metaverse and its related concepts attracted attention from all walks of life. Investment and financial management projects that use the Metaverse as a selling point are springing up like mushrooms after a rain. Some projects are suspected of crimes. Common project types are as follows:
(1) Using the Metaverse blockchain game as bait to induce investors to purchase virtual currencies and then exchange them for games. Coin
Some of the rules set by the "Metaverse" game require participants to use game currency, and game currency must be exchanged for specific virtual currency. Participants must first purchase virtual currency. In this way, investors are induced to purchase virtual currency. currency. For example, in 2021, CCTV Financial Channel exposed that a large number of Metaverse blockchain games require users to first purchase Tether coins and then use Tether coins to exchange for game currency. This act actually converts RMB into virtual currency, which is an illegal public financing act. Another example is the web-based metaverse game "Farmers' World", which requires a service fee to be paid first and 20% of the monthly revenue to be shared with the "game company", while the user sharing revenue actually comes from the payment of players who enter the game later. Once the game loses popularity, the company is likely to take the money and run away.
(2) Hype the real estate of the Metaverse and induce investors to invest and purchase.
Use the concept of the Metaverse to hype the real estate of the Metaverse and induce investors to buy houses and settle in the Metaverse. There are currently many real estate projects in the virtual world. In some projects, a piece of virtual land was sold for more than 20 million yuan, and some celebrities have also purchased virtual real estate. The high prices and star power have made Yuanverse real estate projects soaring in popularity. However, we should note that mature virtual real estate projects are extremely limited, the purchase methods are also very complicated, and the prospects are still unclear. Investors are likely to face complete investment losses, and even more There is a possibility of being scammed.
(3) Using the concept of the Metaverse to issue virtual currency and inducing the public to buy
Investment and consumption in the Metaverse require currency payment. Some criminals claim that the virtual currency issued will be the "currency of the Metaverse" in the future, inducing the public to purchase invest. Such “virtual currencies” are often air coins spontaneously created by criminals, who mainly make illegal profits through behind-the-scenes means such as manipulating prices and setting withdrawal thresholds. As mentioned above, the issuance of LCC film and television virtual currency is suspected of illegal fund-raising. Criminal gangs may use a new slogan of "the universal currency of the metaverse", change the soup without changing the medicine, and continue to illegally raise funds.
4. Suggestions for investors
The digital age has arrived, and various new technologies and new concepts have emerged one after another. Some criminals use these new technologies and new concepts to defraud investors of their money. Therefore, investors should pay attention to their investment before investing. To stay vigilant and master certain anti-fraud skills, we make the following suggestions to investors:
(1) Establish a correct concept of investment and financial management, and pie will not fall in the sky.
People often think that "if you stand in the wind, pigs will fly". Reasons to chase hot spots and make investments. However, it is the nature of human nature to make a fortune silently. When you see the trend, the trend period may be over. Scammers may use the wealth myth of early entrants to defraud late entrants out of their money, and then look for the next fraud opportunity. In the end, only investors who entered the market blindly and were trapped are left empty-handed.Pies will not fall from the sky, and insider information will not appear for nothing. Only by correcting your mentality and keeping your eyes open can you move forward steadily!
(2) Use the Internet to check whether there are risk warnings from government departments.
For new illegal and criminal activities, government departments will make risk warnings or carry out crackdowns. Investors can search for information on proposed investment projects on the Internet and find out whether there are any tips or crackdowns from government departments.
For example, in September 2021, the "Announcement on Preventing the Risks of Speculation in Virtual Currency Transactions" jointly issued by the People's Bank of China, the Supreme People's Court, the Supreme People's Procuratorate, etc. pointed out that virtual currency-related business activities are illegal financial activities, and participation in virtual currency investment and trading activities exists. Legal Risk. After investors understand this risk warning, they need to carefully analyze and make investment decisions when investing.
(3) Use the Internet to understand the business model and analyze the feasibility of the business model.
For new projects that have just emerged, if there are no relevant prompts from the government, it is recommended that investors use the Internet to understand the business model of the proposed investment project and analyze the possibility of profitability. In addition, we must fully realize that "high returns" means "high risks", and "high returns" that exceed common sense often bring absolute risks.
(4) Immediately fix the evidence and call the police after being defrauded.
If investors find that they have been deceived or may be deceived, they should fix the evidence as soon as possible, such as quickly taking screenshots or recording WeChat chat records, personal accounts (names, investments) on the website amount, dividend amount, undistributed profits, etc.), and at the same time, report to the public security organs, seek the intervention of the public security organs, and recover the lost property as much as possible.
The development of the Internet and information technology has brought new ways for people to get rich, and also provided new ways for criminals to make money. Investors should keep their eyes open and make steady investments, and must not be blinded by high returns!
(The author is a lawyer at Beijing Longan Law Firm.)
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