Thieving apps – Binance finds itself in the sights of the Pakistani regulator, because of a classic ponziesque scam which however allowed the crooks to touch a “nice” nine-figure jackpot.
Binance and Ponzi in Pakistan: 100 million stolen by mobile applications
The Cybercrime Division of Pakistan’s Federal Investigation Agency (FIA) said in a statement that it asked the local branch of Binance, and in particular Binance Pakistan’s CEO, Hamza Khan, to provide them with information as part of a criminal investigation into a scam.
The agency says it was contacted by many people on December 20, 2021, complaining that it was ” swindled billions of rupees After at least 11 local mobile apps have stopped working.
They required victims to register with Binance, and transfer funds from the exchange to these scam apps. The victims were also added to Telegram groups, where the anonymous owner (s) of the app and the administrators of the groups gave so-called “expert” signals so that they could bet on the rise or fall in the price of bitcoin (BTC ).
The FIA estimates the amount of this Ponzi scheme to be about $ 100 million :
“The investment range per person extended from $ 100 to $ 80,000, with an estimated average of $ 2,000 per person, bringing the amount of the scam to nearly $ 100 million.”
As in any ponzi scheme, early investors who deposit funds into the system receive substantial compensation from more recent client deposits. The system thus gains in credibility during the first weeks or the first months of its operation, and attracts more and more victims in his nets. Once the deposit amounts are large enough, the scammers disappear with the funds.
<< Easily buy your cryptocurrencies thanks to the KuCoin crypto platform (affiliate link) >>
Tracking scammers and freezing accounts: possible sanctions for Binance
The FIA said it has taken measures to “ trace the source of this scam “, By blocking in particular” the debit “of all Pakistani bank accounts linked to these applications. The agency further contacted Telegram executives in hopes of identifying the people behind the scam apps.
The agency said it also sent an investigation form to Binance headquarters in the Cayman Islands and Binance US.
She further discusses the fact that at least 26 suspicious Binance wallet addresses have been identified as recipients of part of the stolen funds. She thus asks the Binance entity to provide the details of these accounts and to block them without delay.
The branch in charge of the fight against cybercrime of the FIA Binance threatens possible sanctions in case of “non-compliance”, recommending that “financial penalties” be imposed on the stock exchange, “through the State Bank of Pakistan”.
Binance’s relationship with regulators in different countries remains strained. The crooks are only fueling tensions between the stock exchange and the Pakistani regulator. Binance may once again have to get its hands on the wallets because of this scam. The exchange had previously spoken of the past fined in Turkey for having been deemed too lax in the application of measures to combat money laundering.
Play it safe and buy your cryptocurrencies on serious crypto platforms. Register on the KuCoin platform and start trading your BTC or other cryptos there today! (affiliate link)