Shopin founder scams $42 million cryptocurrencies ICO

Recently, the U.S. Securities and Exchange Commission (SEC) filed a lawsuit against Shopin’s founder, Eran Eyal, alleging that it was operating a fraud ICO to defraud investors of $42 million. Initial coin offering (referred to as ICO for short) is also called token sale activity, which is a way to raise funds without having to rely on banks or angel investments.

Before an ICO begins, a company usually develops a business plan, a white paper documenting its blockchain technology, and USP’s expectations for services. In exchange for user funds, participants will receive tokens. The risk is here! If a project is illegal, investors will only have some worthless virtual currency.

It is understood that Eyal cheated their funds by tricking its investors into investing in their “projects”. Eyal claimed to its investors that the funds they invested will be used to develop a platform that can support universal shopper profiles on the blockchain. It will track purchase history and be able to make recommendations based on this data. But the truth is that the platform has never been developed so far. The SEC also stated that Eyal’s Shopin token issue has never been registered with the SEC.  After allegedly fraudulently raising $ 42 million, Eyal allegedly spent the money on personal expenses, at least $ 500,000 of which went to dating, renting, shopping and entertainment.  ​

Eyal is currently charged with violating federal securities laws. The committee is preparing injunctions, civil penalties, compensation matters and permanent injunctions against Eyal. And ask all those suspected of being deceived through Shopin ICO to contact the agency as soon as possible.

Via: ZDNet