A cryptocurrency trading app has been accused of being a scam, with BBC News reporting that the listed CEO and "strategic partners" like MIT and Qualcomm have never heard of it.
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A trading app called iEarn Bot has cost thousands of would-be cryptocurrency investors everything and could "be one of the largest crypto scandals to date," according to a report by BBC News.
According to the BBC investigation, the company operates in a large number of countries, including Romania, Indonesia, Nigeria and Colombia.
"At first the app works very well," said Silvia Tabusca, a Romanian expert on organized crime for the European Center for Legal Education and Research. Claiming that the number of investors appears to be "quite high," she said:
"When they have enough investors and enough money invested in a specific country, they don't allow that country to withdraw any more — and they open other countries."
Withdrawals Frozen
That was the experience of a Romanian investor who spoke to the BBC News under the name Roxana.
Saying that the customers buying the bots were told their funds would be invested by the firm's artificial intelligence platform, Roxana added that it guaranteed high returns, and seemed to work well for a while.
"You could see in the app how many dollars the app was creating: there were graphics showing how the investment was progressing," she said. "It looked quite professional until, at some point, they announced maintenance."
Withdrawals were frozen and never restarted, BBC News said. Roxana said:
"I made the request to withdraw and the money just disappeared. The portfolio became zero — but I was never credited on my wallet with any money."
The report said dozens of high-profile Romanians invested because "the app was sponsored by … a leading IT expert in the country."
Who told the BBC that he, too, invested savings and lost money.
Red Flags
The report noted that when some of the claims on the iEarn Bot website were fact checked they could not be confirmed.
These included the person named as CEO saying he'd never heard of the project, and both the Massachusetts Institute of Technology and companies including Huawei and Qualcomm listed as strategic partners denying any knowledge of it.
The iEarn website is definitely editorially challenged.
Aside from the bots, the company had launched a token, IBOT.
"The IBOT Smart Coin White Paper" available on the website has the following tagline: "Build a new ecosystem of global decentralized digital."
It goes on to say "The company's main product is AI artificial intelligence robots."
The first line of the whitepaper reads:
"With the continuous maturity and development of the Internet and IT technology, blockchain technology has also become much attention."
In addition, the website also has a prominently displayed copy of the company's money services business (MSB) registration with the Treasury Department's Financial Crimes Enforcement Network (FinCEN). Which is, according to the FinCEN website's MSB Registrant Search tool, legitimate.
However, the FinCEN web page also says, in bold print:
"The inclusion of a business on the MSB Registrant Search Web page is not a recommendation, certification of legitimacy, or endorsement of the business by any government agency."
However, that document and a couple of Colorado corporate registration documents — which anyone can get — led one Colombian investor, who also actively recruited investors, to say "that showed they were legit."
But the report said Colombian withdrawals were halted in December. And BBC News tracked down a digital wallet that received some 13,000 payments worth about $1.3 million.
