June 13, 2023

Gang in Dubai Fined over $500 Million over BTC Scams



A gang of seven people was arrested in Dubai, which was accused of a Bitcoin scam worth AED 10 million ($2.7 million).

The gang, which was composed of one Pakistani national and six Bangladesh nationals, posted TikTok videos to attract people to mint and invest in crypto. 

When victims started investing in their company, the gang began to distribute a sum of money to the victims to make the scam seem more legitimate and lure in more victims, according to Cointelegraph

According to the police, nearly 180 people came to the police station to make complaints about being scammed by the gang. The Dubai Criminal Court heard that they defrauded five people out of AED 321,000 after promising to double their money by investing in a crypto wallet.

The court also found that the gang used social media platforms to advertise their three companies which alleged to invest in Bitcoin.

Although they did not go to jail, each one of them was fined more than AED 321,000 ($87,395) in addition to AED 20,000 ($5,445) for operating a virtual asset business without obtaining a license from the relevant authorities.

Two scammers were caught at the UAE-Omani border while trying to flee from the authorities. Later, the police discovered that the group had registered a company with a trading license, but not authorized to conduct crypto transactions.

The police expected it would bring more cases to court, while Dubai court records also attached a report from the economic crimes department which confirmed that the group deceived 3,000 victims in Bangladesh.

Certik, in its report on the crypto losses in the first quarter, said the crypto losses in the first quarter of this due to hacks recorded more than $320 million.

In 2022, the crypto industry lost more than $3.94 billion, a report by Immunefi, Web3’s leading bug bounty platform, revealed. 

According to Immunefi’s Crypto Losses in 2022 Report, hacks were the main reason for these losses, accounting for 95.6%, while rug pulls, scams, and fraud represented only 4.4% of the total losses. Because of hacks, the crypto industry lost over $3.77 billion in 2022 in 134 specific incidents,

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