Founders of the company that sold tea-secured token, for three and a half years deceived three thousand investors.
Shenzhen police arrested six people who appropriated $ 47 million, owned by three thousand investors from China, writes the local newspaper Guangdong Daily. Criminals sold the cryptocurrency, which, they claimed, was backed up tea.
In January 2017, PEB company began selling the Pu’er Coin token (later renamed as “Puyin coin”). The project website reports that buyers receive a contract that gives the right to own a certain number of shares of Pu’er Tibetan. Scammers claimed that they cost billions of dollars.
The token could be exchanged on the Jubi.com site, and quqian.com posted information that if you store the coin for 12 months, you can be guaranteed to receive 12% of the income. According to the police investigation, the company owned a limited number of such shares, but with the help of advertising in social networks and presentations held in expensive hotels promised their investors a high short-term dividend.
The project succeeded in attracting a large number of users by manipulating the coin’s price with the help of its own funds in the secondary market. The rate of the token increased 20 times last year.
In April, the company received a warning and a fine from the Chinese State Market Regulation Administration, which is engaged in ensuring fair market competition. The department fined Pu’er Tibetan for $ 20 million for spreading false information that the value of the cryptocurrency is backed up by large reserves of Tibetan tea.