Cryptoqueen: A woman scammed the world, then vanished (2019)

https://www.bbc.com/news/stories-50435014

by mgh2 • 5 years ago

278 191 5 years ago

jacquesm• 5 years ago

Pretty good chance that she didn't vanish but was killed, vanishing is a trick that is becoming exceedingly hard.

dmix2• 5 years ago

Osama Bin Laden had an extremely long run, considering the CIA and NSA was after him at max agenda. Almost embarrassingly long.

Ayman al-Zawahiri (the defacto “leader” of Al-queda today) could easily be in some back room hidden in Pakistan right now. He technically is not listed as dead either.

https://en.wikipedia.org/wiki/Ayman_al-Zawahiri

Stranger things have happened in our world.

It depends on how much these experts law enforcement people care too. A random IRS guy found the Silk Road guy, not some fancy investigation. The question is anyone in India, or where ever with corrupt police and military, are even looking hard for her.

You probably need someone like the Americans, UK, or Russians (see Shamil Basayev https://en.wikipedia.org/wiki/Shamil_Basayev) IRL to really care at this level.

Note: I haven’t listened to the podcast or deeply into her, just my point of view on that subject.

skinnymuch2• 5 years ago

Bin Laden is one thing. But what’s the use of taking out the de facto leader of an org that will have no problem having a replacement immediately like Al-queda? It makes more sense when you’re doing a full on or strong attack like right after 9/11 or for When ISIS was brought down a ton.

—

For the Silk Road. That’s true. However the next two silk roads had the people arrested fairly quickly.

Note: I don’t know much or anything about hiding out or disappearing.

dstick• 5 years ago

An IRS guy found the Silk Road guy? Do you have a source? I remember reading that DPR got caught after some faked murder for hire plot by a (what later turned out) corrupt FBI agent after leaking the Silk Road IP of his Icelandic servers, which were then silently taken over and monitored.

yawaworht1978• 5 years ago

Nope, it is not that hard, just cannot live the big life. I am not so sure if she was the real head of operation anyway, more like the publicly visible rep(bit like a nominee director).

brobdingnagians• 5 years ago

Especially disappearing from people with money and power.

"I can't discuss that. It starts to get very very very scary, very very very fast." According to Bjercke, Dr Ruja never expected OneCoin to grow so big. People involved at the early stages have told him it was never supposed to be a billion-dollar scam. She tried to close it down, he says, but the dark forces wouldn't let her.

Even if you think you are going to get something and profit, one big reason to stay away from scams and fraud is that there are big players in the area that are 1. already established, 2. willing to do much worse things than you to get their way, 3. don't want someone else stepping on their territory. The mafia doesn't let petty thieves steal in their areas. You simply become a pawn to their schemes; then forced to do things you never anticipated having to do.

Also reminds me of the Inner Ring by CS Lewis [1]. Stay away from secret societies, fraud, corruption, and crime. There are some very bad people in the world with some very organized problems.

It's a much simpler life to just be an honest, unknown, middle class person.

[1] https://www.lewissociety.org/innerring/

Baeocystin• 5 years ago

Excellent read, and spot-on, IMO. Thanks for the link.

matheusmoreira2• 5 years ago

Very wise.

To a young person, just entering on adult life, the world seems full of “insides,” full of delightful intimacies and confidentialities, and he desires to enter them.
But if he follows that desire he will reach no “inside” that is worth reaching.

This curiosity can lead us to some pretty dark corners of the world. Especially on the internet.

da_big_ghey2• 5 years ago

i am hating this fact. now each document is electronic validationed so cannot fake. no way for to leave and become new person. no way for to disappear. damn surveilance state.

andix2• 5 years ago

In some countries you can buy real identities with real passports, including a citizenship. Should be possible to do in Serbia or Bosnia. Maybe even in Bulgaria (EU).

During the war in Yugoslavia a lot of records got lost and it is still common practice to reissue birth certificates based on some witness statements.

krisoft• 5 years ago

In what sense do you want to disappear? Do you want the option to abandon everyone you know and start a new life in a new place? You can totally do that. The state is not stopping you. If people from your former life report you missing and the police finds you, you can always say “i do not wish to be contacted by them” and if you are an adult they will leave you at that. Pretty extreme thing to do, but happens all the time.

Do you want to get away with murder? Run away from debts and obligations? Why would we as society let you do that?

ardit33• 5 years ago

Could be. But also the Balkan mafia operates in another level when it comes to identities. There are stories, of eventually someone getting caught, and it is realized that the guy was wanted for 15+ years, by some (usually Western Europe) country, interpol and all, has changed their names 3 times and they live care free in another country.

They completely change identities, new names, new passports, new looks, new citizenship. With enough money, it becomes just a routine thing. It is like they run a Tor network ring, but on personal identities.

Often, they are found when they get in trouble with their old pals (usually unsettled scores), and not the police.

blackearl• 5 years ago

They're never truly living carefree. Everywhere you go you'll always be looking over your shoulder, waiting for the day they get you.

RichardHeart• 5 years ago

Here's how you solve scams: 1. More law enforcement (Doesn't work in countries that can't even enforce laws against murder so well. Only works after the fact, and the money is nearly never recovered.)

2. Yell as loudly as you can for people to stop getting scammed. (They thing you're wrong, and you have no marketing budget to get your voice heard. It takes 10 units of energy to disprove bullshit and only 1 unit of energy to generate it. It's harder to convince people they've been scammed. This is also known as the curse of the duped.

3. Actively advertise superior investments with longer time horizons so that they don't have the money sitting in their hands to so easily be scammed out of. You can even generate a marketing budget to get eyes away from the scams onto the good things. (You will be yelled at by everyone that doesn't like what you built. Especially if its successful.)

DonHopkins2• 5 years ago

In the spirit of following your own advice on solving scams, specifically #2:

As the winner of the "Golden Pump Award" for "Best New Scam" for "HEX", and as one of the first people in the world to be successfully sued for online spam, specifically the Viagra spam scheme that you ran from Panama (which you lost, under your previous name "Richard J Schueler"), you could personally solve scams by ceasing and desisting your shilling of HEX, and your recruiting of unsuspecting developers to work on it, and your illegal false claims of providing CDs (certificates of deposit).

Richard Hart (aka "Spam King" Richard J Schueler) wins the "Golden Pump Award" for "Best New Scam" for his POS shitcoin Ponzi scheme "HEX":

https://twitter.com/JuanSGalt/status/1233242355995750400

https://www.youtube.com/watch?time_continue=857&v=tf-lJu5iDh...

Peacefire.org beats spammers in court.

https://www.zdnet.com/article/peacefire-org-beats-spammers-i...

Free-speech group Peacefire.org wins a legal round in its fight against unsolicited e-mail, invoking Washington state's anti-spam law.
The King County District Court in Bellevue, Wash., on Monday granted Peacefire $1,000 in damages in each of three complaints filed by Peacefire Webmaster Bennett Haselton. The small-claims suit alleged that Red Moss Media, Paulann Allison and Richard Schueler [who now operates under the pseudonum "Richard Hart"] sent unsolicited commercial messages to Haselton that bore deceptive information such as a forged return e-mail address or misleading subject line.

Confronting Richard Heart of HEX - SPAM KING and Crypto Scammer

https://www.cointelligence.com/content/confronting-richard-h...

During ANON Summit 2020, I participated in a “fireside chat” with Richard Heart, founder of HEX. HEX is one of the most sophisticated, if not THE most sophisticated scams I have ever seen.
Why was I so aggressive with Richard? I have a lot of experience fighting with scammers, at events, and in online discussions. I’m familiar with their bullshit techniques. Richard is the sort of “master debater” who will answer a question without actually answering the content of the question. I watched more than 6 hours of his previous talks and learned how to tell when he was trying to avoid a real answer.
If you don't want to sit through hours of interviews yourself, this 4 minute video not only sheds light on Heart's motivation for establishing HEX, but also shows just how abrasive and crude he can be. This video was not created or edited by Cointelligence.

https://www.youtube.com/watch?v=_MIdlXHedlU

I want to draw your attention to the quote in the video above: "What am I going to make more money doing? Promoting my token, that I own a whole ton of? Or promoting bitcoin, where I own one-one zillionth of the available supply?" He's clearly in this to make money for himself in any way possible. [...]
When asked why HEX was not categorized as a security, at around the 21 minute mark, Richard offered an explanation that has no legal grounding. On the website, HEX claims that it is "The first high interest blockchain certificate of deposit." However, HEX has no legal authority to issue CDs. Richard is illegally claiming to provide CDs when in fact the instruments are nothing but glorified savings accounts.

More quotes: "What's up now, f*ggot? What are you going to do now, you little b*tch? Get the fuck out of here! That's the dumbest piece of shit I've ever seen in my fucking life. [...] Let me give you some more bullshit, ok?" -Richard Heart aka Richard J Schueler

Richard Heart - Spam, ICOs, and Death Threats

https://imnotdead.co.uk/blog/richard-heart

Richard James Schueler - Friggin Spam King

https://web.archive.org/web/20190416235350/http://www.panama...

Why HEX is a Ponzi and not a solid investment (Part 2): Richard Heart

https://www.reddit.com/r/CryptoCurrency/comments/kwhjxa/why_...

During the interview at ANON, Richard confirmed that he was one of the first people in the world to be sued for online spam, back in 2002. This shows us Richard has experience abusing unregulated markets, as he is doing with crypto these days.

Is this an accurate quote of your own words?

When I pressed the matter and asked for a simple “yes” or “no” as to whether he, as the FOUNDER of HEX, knows who benefits from the funds sent to the “Origin Address” he flat-out said “I’m dodging your question.” Dodging the question! He proceeds to repeat “Dodge, dodge.”

Richard, your tag-line "Do you want to develop my new cryptocurrency?" is the new "Do you want to develop an app?"

https://www.youtube.com/watch?v=jVy0JWX5XEY&ab_channel=Adult...

"Dodge, dodge." -Richard Heart aka Richard J Schueler

dmix2• 5 years ago

I tested this explanation on my mother, the family technophobe, and she told me I'd failed to make it clear enough and should start again. So don't worry too much if you don't follow it either

It makes you wonder if the BBC author should have tried to explain what crypto was at such detail at all in the first place.

The 3 long technical paragraphs disrupt the narrative.

Just give some witty one or two lines for the luddites. I doubt they care about public internet databases anyway.

rbanffy• 5 years ago

Not knowing this little bit of what a cryptocurrency is allowed Onecoin to be such a large scam.

Animats• 5 years ago

If they'd actually implemented a blockchain, they would have been in the clear. No worse than many altcoins.

woah• 5 years ago

If they’d actually implemented a blockchain that did what they said it did, it wouldn’t have been a scam. As it is, this has about as much to do with cryptocurrency as most Nigerian princes have to do with the African nobility

andix2• 5 years ago

As soon as they would have turned the system on, people would’ve been able to sell One Coin. And it would’ve got a real price, determined by the market. Not some fake price, set by the company.

cookguyruffles• 5 years ago

Artificial pricing is still possible in the blockchain world, it's just called staking over there

daenz2• 5 years ago

It was a cryptocurrency company, and it had been running for a while - but it didn't have a blockchain. "So we need you to build a blockchain," he went on.

I have seen this first hand, on a much smaller scale, at a startup that was riding the blockchain hype with investors. It is really incredible and eye-opening to me what you can accomplish with hype and trust, with absolutely nothing backing it. It makes you realize that it doesn't matter if what you build is cool or innovative, if you can't get people to trust you, it won't succeed.

46756e• 5 years ago

This is very true for crypto. The amount of people hyped on it without understanding much about it seems crazy high to me.

Granted, I recently graduated college, so I may be bias from experience. I just have seen a giant amount of finance frat bros that pour money into Bitcoin cause “banks are like the horse and buggy”.

hanniabu• 5 years ago

The amount of people that discredit it without understanding is also crazy high. Just because scams exist doesn't mean there aren't real projects and use cases.

Nasrudith3• 5 years ago

They are an especially pathological manifestation of Buzzword Zombies who shamble around brainlessly suggesting use of their golden hammer in all contexts.

Actual finance graduated though? What the fuck were they doing in class all of those years to even think of the two as comparable?! For one let me know when I can get a mortgage or auto loan from bitcoin itself.

amelius• 5 years ago

I think this is because "cool startup" works as a signal for speculation. It doesn't matter that there is no value backing it, investors have this unwritten agreement that cool sounding projects get investments and with money behind the project, it automatically becomes more valuable.

tudorw• 5 years ago

Let's not knock it, vast swathes of internet were built with hype money, if something is really novel, it takes a leap of faith to invest.

alisonkisk5• 5 years ago

Not really. Government grants, paying telecom customers, ad buyers, porn buyers.

pessimizer• 5 years ago

The only difference between selling bullshit and selling quality is that quality will get you more positive word-of-mouth advertising per sale. If you're selling bullshit, you need to either actively suppress the word-of-mouth, drown it out with marketing spend, or offer a cut of future profits (or something that looks like a cut of future profits) to buyers.

varsketiz• 5 years ago

What about recurring customers? Clearly this is not the only difference.

imiric• 5 years ago

Con artistry is an old profession, this is just the modern take on it.

It's the Theranos approach. With a charismatic and strong character as founder you can build hype and get investments without even having a product. Being on friendly terms with investors also helps to establish trust.

Nasrudith3• 5 years ago

Here is something which struck me as obvious yet would get furiously disputed: if you care about the charisma of a company head, or any other superficial aspect like City of London fashion etiquette you are being an idiot and are asking to get scammed by privileging what you expect to see above talent. It is what they do that is the important part.

alisonkisk5• 5 years ago

Theranos desperately tried to build a product. They failed and lied about it. The plan wasn't to profit from the fake stuff and exit.

lottin• 5 years ago

One thing I've noticed about the crypto crowd is many of them seem to genuinely struggle to differentiate a scam from a legitimate business. Some are obviously scammers, but others it seems they don't really know what they're doing... they think they're running a business.

kordlessagain• 5 years ago

Most of them would struggle to understand how the shit works as well.

miohtama3• 5 years ago

Like with all businesses, there is a difference between failing for right reasons (tried hard, run out of runway) and wrong reasons (lied to the investors). Unfortunately unsophisticated investors do not understand the difference.

I have collected some of the cases and different points on my post here, including the infamous OneCoin:

https://capitalgram.com/posts/history-of-cryptocurrencies/

snotrockets• 5 years ago

No wonder: there aren’t any legitimate businesses. It’s all speculation and money laundering. No other reason to not use real money

tootie• 5 years ago

Theranos springs to mind. When you can dazzle enough rich people with FOMO over technologies they don't understand, it can be pretty easy.

daenz2• 5 years ago

Reading this made me realize that even though Bitcoin is legitimate, Satoshi was pretty wise to conceal their identity before it gained any traction.

skinnymuch2• 5 years ago

Satoshi could still be a small team from a high level Govt agency. Or something else. Might not be one or a few civilians at all.

neom2• 5 years ago

Relatively good mini doc about this: https://www.youtube.com/watch?v=64xcgvEJ3Ys

tbh I've spent waaay more time than I'd care to admit diving deep into onecoin over the past few years. It's really really really wild the more you dig. Happy to answer any questions.

hatmatrix• 5 years ago

What's wilder than already covered in these docs and podcasts

neom2• 5 years ago

I'm not sure what you've consumed so that's somewhat difficult to answer, but the part I found the most interesting is all the "dealshaker" stuff that happened after, and I think might still be going on.

narrator2• 5 years ago

You know how you create a cryptocurrency that immediately rivals Bitcoin with no effort? You fork Bitcoin and give it a cute mascot. Dogecoin has a $65 billion marketcap and was made in about two hours as a JOKE. It's totally open source, so there's nothing even illegal about it:

https://twitter.com/BillyM2k/status/1393271686384914432/phot...

I remember seeing Ethereum starting up and they had a demo where you could make your own cryptocurrency in about a page of code. I thought this shit is never going to work. I WAS SO WRONG.

I am sure this cryptoqueen scammer put a ridiculous amount of effort into her scam when these people who actually made absurd amounts of money legally in altcoins did far less work.

Waterluvian• 5 years ago

I think the difference is likelihood of success.

If you and I did what you'd describe it would almost certainly not succeed. A high effort fraud has a much higher likelihood of returns.

agumonkey• 5 years ago

a few semi pro traders i've seen made one for the lulz (with absurd names like karencoin) and the price rocketed (illiquid asset) which made them withdraw their trade from the market because they assumed it was a sign of dumb level bubble hit

narrator2• 5 years ago

How about Losercoin? Two self-described broke losers in rural China created it and put their life savings into providing it with liquidity. It now has a 53 million dollar market cap.

KETpXDDzR2• 5 years ago

AWS and until recently Azure have Blockchain-as-a-service. The real winner of a gold rush are the people selling pickaxes.

https://azure.microsoft.com/en-us/services/blockchain-servic...

https://aws.amazon.com/blockchain

555552• 5 years ago

The real winner of a gold rush are the people selling pickaxes.

No I'm pretty sure the people who hoarded gold (coins) have made more money from blockchain than IBM and AWS.

dehrmann• 5 years ago

With cryptocurrencies, the pickaxes are GPUs and ASICs. I doubt this is a serious revenue generator for AWS because of how few things actually need and use blockchains. It's mostly there so consultants can sell blockchain solutions to companies desperate for a blockchain strategy.

arambhashura• 5 years ago

Microsoft is apparently shutting down its blockchain service, though: https://docs.microsoft.com/en-us/azure/blockchain/service/mi...

trompetenaccoun• 5 years ago

She's not a programmer. As far as I know OneCoin never even had a blockchain, it was just a regular ponzi scheme they sold as cryptocurrency. Not the first time this happened and it won't be the last, sadly. I actually have a distant relative who bought into another such scam.

bennysomething• 5 years ago

It didn't have a block chain. There's a great BBc iPlayer podcast about it, crypto queen. Worth a listen. Apologies if this has already been mentioned.

paulpauper2• 5 years ago

fraud is profitable because it makes exaggerated claims. that is why people do it.

legit projects are expensive and have high rate of failure

doge is just one success out of probably thousands of others that tried similar concepts. Doge was able to gain a loyal following and community early on.

grp000• 5 years ago

Ironically, because of how ridiculous it was.

dleslie7• 5 years ago

Dogecoin may as well be called Eloncoin, now; the value tracks his tweets about it.

A practically-infinite cap and always-easy mining? It's designed to rapidly deflate in value. _That's the joke_. And yet it bubbles.

eloff2• 5 years ago

Those properties mean it could actually work as a currency, unlike bitcoin.

It also can handle higher transaction volume with cheaper fees.

I don't think it'd be a good currency, but it's funny to compare it with bitcoin which was marketed as such but is totally a failure for that use case.

aplummer2• 5 years ago

ELON already exists, 630m market cap right now...

https://www.dextools.io/app/uniswap/pair-explorer/0x7b736449...

spinny• 5 years ago

He just realized that he can, so he does it.

Probably got on the market before the BTC/Tesla announcement and then pumped it, then thew DOGE in the for the memes and then Tesla announces that BTC consumes too much energy and that are looking out for a greener alternative. ETH is switching to PoS. At this point, he is probably slowly filling bags of ETH and gonna pump as soon as PoW on ETH ends. Expect a series of excited twits from Elon then

gh555• 5 years ago

Just so you know, Dogecoin's blockchain is trivial to attack; its ledger can be altered at such low cost it is unlikely several such attacks aren't already underway. Upon publushing of new "longest chains" it will no longer be possible to determine which doge chain is valid, putting all balances in danger until the Proof of Work mechanism is replaced - which will only work briefly before the same problem recurs, due to the nature of how blockchains are secured. This will demonstrate why Bitcoin and Ethereum are valuable. More info: https://www.intuitecon.com/post/why-dogecoin-is-going-to-zer...

Cicero22• 5 years ago

Most of the other articles I saw when I googled "51% attack doge" said that this was unlikely, and that it had the 3rd most hashing power among crypto, mainly because of it being mined with litecoin. Saying it would be trivial to attack comes off as a hyperbole with that in mind. Litecoins 1 hour attack cost is $29,000, while Bitcoin's and Ethereums are $716,000 and $418,000 respectively, only a magnitude higher.

Those articles also mentioned a lack of incentive due to sending the price to zero, but perhaps that's an incentive now since there are ways to short the price of a coin.

vmception3• 5 years ago

I had a European girlfriend at the time, (I’m an American and we were both in America) her sister was exposed to onecoin and was her sisters sole exposure to blockchain ideology.

So I asked her to forward the marketing materials to me, and oh my god, it is not possible to discern the problems wrong with it without formal education in both computer science like linked lists and initial exposure to real blockchains.

Its doesn’t matter that the first question to ask was “ok where is the block explorer and what consensus model does it use” because nobody exposed to onecoin first would ask that

The other thing, which I find much funnier, is that they become not fraudulent just by launching a token on an existing blockchain or deploying their own, and that’s all they had to do but didn’t.

spuz• 5 years ago

Did you convince your girlfriend's sister that it was a scam?

vmception3• 5 years ago

She didnt put money into it. But she was just as excited about blockchain ideology as I was and I would just be the second prophet she was exposed to. It is impossible to discern the difference when religious-like ideology has already occupied that register in your brain.

pjc50• 5 years ago

that they become not fraudulent just by launching a token on an existing blockchain or deploying their own, and that’s all they had to do but didn’t

I submit that that would not be enough to make it not fraudulent.

ok where is the block explorer and what consensus model does it use” because nobody exposed to onecoin first would ask that

Doesn't matter. What matters is who's shilling and how effective they are. Like Elon and Bitcoin.

vmception3• 5 years ago

I submit that that would not be enough to make it not fraudulent.

It would still be a rip-off for purchasers, but it would have reduced their legal liability to nothing in the various countries involved. Then they could just squirm around securities laws based on how they marketed it, like everyone else.

lph• 5 years ago

I am sure this cryptoqueen scammer put a ridiculous amount of effort into her scam when these people who actually made absurd amounts of money legally in altcoins did far less work.

Right?! All they had to do is fork an open-source cryptocurrency, and they couldn't even do that. It's hilarious. With the hype empire OneCoin controlled, it's quite possible that it could have astro-turfed its way to a bubble like those of bitcoin or dogecoin.

Marciplan3• 5 years ago

This podcast had such insane production quality —- but also a sincerely huge lack of journalism. So. Many. Holes. In every thing they “report”.

555552• 5 years ago

lol kthx Dr. Ruja

Marciplan3• 5 years ago

Haha, no, everything about OneCoin is a scam. I just don’t think the podcast is made from journalism, rather sensationalism.

raunak2• 5 years ago

Examples of said holes? Out of curiosity

Marciplan3• 5 years ago

The one that immediately jumps to mind (it’s a while since I listened to it) was where they interview a Dutch MLM-guy and just report his wild stories as facts, without having spent time to have others vet it. It’s a fantastic story, but framed as a journalistic piece which it was not.

FDSGSG• 5 years ago

In the grand scheme of things it's a minor detail, but they clearly didn't study the history of digital money:

For a long time, people have tried to create a form of digital money independent of state-backed currencies. But they have always failed because no-one could trust them. They would always need someone in charge who could manipulate the supply, and forgery was too easy.

There have been some rather successful attempts at creating digital money. E-gold, Liberty Reserve. The problem was never that someone might manipulate the supply, but censorship resistance. All the successful players in this space ended up getting shut down by governments, cryptocurrency solved this little detail.

Clearly they just regurgitated some cryptocurrency pitch without doing much fact checking.

handmodel• 5 years ago

This was such a good podcast as long as you are ok with a bit of the journalists inserting their research process into things.

They went to Uganda where OneCoin was big. They had created a MLM type system there where they got the local priests to give sermons on why it was good. They interviewed people who sold their livestock - even though they didn't own a computer or cell phone so had no idea what it was - for a few hundred dollars to invest.

It was also highly marketed in the Arab world where it was marketed specifically towards people who can't invest in companies that have interest on loans.

Truly a wild scheme.

hnzix• 5 years ago

The Wig punched himself through a couple of African backwaters and felt like a shark cruising a swimming pool thick with caviar. Not that any one of those tasty tiny eggs amounted to much, but you could just open wide and scoop, and it was easy and filling and it added up.

The Wig worked the Africans for a week, incidentally bringing about the collapse of at least three governments and causing untold human suffering.

At the end of his week, fat with the cream of several million laughably tiny bank accounts, he retired.

t8e56vd4ih• 5 years ago

you should check the footage of her on YouTube promoting her coin purely for entertainment. it's utterly ridiculous. she's a personified red flag.

unnouinceput• 5 years ago

Quote: "...says there are similarities between OneCoin and messianic millennium cults, where people believe they are part of something big that is going to change the world - and no matter what the evidence, once they've signed up, it's very hard for them to admit they are wrong."

Yeah, I can say the same about Catholic, Orthodox, Muslim and any other major religion in this world. Ever talked with any of these bigots? You want to run for the hills.

nicklecompte2• 5 years ago

Quite a contrast in reactions between the guy who made millions of dollars from the OneCoin scam and bought a big fancy house:

After Dr Ruja's non-appearance in Lisbon, a point came when Igor Alberts, like Jen McAdam, asked to see evidence of the blockchain. He didn't get it, and in December 2017 he quit.
I ask if he felt guilty, for having sold so many people a coin that didn't exist, and for having made so much money in the process.
"I felt responsibility. Not guilt," he replies. "You can never be blamed for believing in something. I had no clue that it could be false. I didn't even know what is a blockchain… What doubt can I have?"

Versus the woman who lost a lot of money and convinced her friends/family to also throw away their money:

By contrast, Jen McAdam says she bears a heavy burden of guilt. I ask her how much she earned from selling OneCoin and she says it was €3,000 - €1,800 of which she received in cash, and which she used to buy more OneCoin.

The line about “you can never be blamed for believing in something” is of course self-evidently ridiculous and not something Mr. Roberts would pretend to believe in any other context. But “I’m not a bad person, I was a hapless victim like everyone else” has a compelling logic when you’re profiting from a bad system.

dleslie7• 5 years ago

It certainly is a bizarre argument. With absolution of guilt for wrongly held beliefs, one could engage in deplorable actions without a tinge of later guilt.

We all have a responsibility to question our beliefs, and what harm our actions cause.

marnett• 5 years ago

Yes we do have that responsibility and obligation. Reading his fallacious defense had me immediately thinking of the essay “The Ethics of Belief”[0].

[0] http://people.brandeis.edu/~teuber/Clifford_ethics.pdf

FpUser3• 5 years ago

"We all have a responsibility to question our beliefs, and what harm our actions cause."

Can you point me to any source that spells it in legal terms in relation to general public (not specific cases like food inspector)? Like some written law.

Also if existed think of what would such law would to to politicians unless they're specifically exempt.

danmaz74• 5 years ago

As the article says, Igor Alberts was already an established multi level marketer making a lot of money with other products when he started with OneCoin. Considering the nature of MLM, I'm not at all surprised about him being rather impervious to feelings of guilt.

jollybean4• 5 years ago

Cryptos are MLM's.

If you made a really solid crypto today, that was designed to remain solid and relatively flat, it wouldn't be popular - because the whole attraction is the 'easy money' euphoria.

No euphoria, no attention.

It's why a 'really good Bitcoin' - which tried to price at $1 USD today, and remain at that real valuation and avoid devaluation, would be hard pressed to exist - it wouldn't take hold. Or rather - that kind of financial instrument would have to be sold to banks, not small change MLM people, and banks are really conservative. It may happen at some point.

exhorresco• 5 years ago

From the photos in the article, you can clearly see the delight in their eyes. The type of delight which only lying can deliver. I believe it's called "duping delight". I'd be willing to bet that Igor Alberts is all too familiar given his background.

https://www.paulekman.com/blog/duping-delight/

ivanhoe• 5 years ago

Perhaps she's just a more socially skillful, so she offered a better sounding excuse? That guy has a douche written all over his face, but that doesn't mean others involved are any better...

nicklecompte2• 5 years ago

I would argue the person who was extremely successful in MLM is likely very “socially skillful.” It certainly doesn’t meant he’s tactful or decent, and his attitude isn’t uncommon.

But I agree you don’t need to say think one person is “inherently” more ethical than the other: all else being equal, the person who got badly burned by MLM is going to be more empathetic than the MLM millionaire.

croes• 5 years ago

That guy in the article

"I did the calculation how many coins we needed to become the richest person on the planet," Igor says. "I said to Andreea, 'We need to build it up to 100 million coins, because when this coin goes to €100 and we have 100 million, we are richer than Bill Gates.' It's mathematic. It's easy as that."

100€ * 100 million = 10 billion€ Bill Gates net worth 2016 was 76 billion dollars. So much for "It's mathematic. It's easy as that."

valtism• 5 years ago

Igor Alberts has struck me as about as much as a cartoon villain type as I have ever seen. Obsessed with money and completely lacking in any sense of empathy. His excuses ring very hollow.

forgotpwd16• 5 years ago

The "didn't know" statement seems like a blatant lie as that guy started DagCoin, an OneCoin's strategy clone, soon after. Especially considering, as he run an MLM which is basically a legal pyramid scheme, he has a good knowledge of this business.

saagarjha2• 5 years ago

Some discussion from earlier: https://news.ycombinator.com/item?id=21618346

klaudius• 5 years ago

I was at one of their scam seminars. There was some sociopath lying for an hour straight and trying to get people to purchase some package for mining Onecoin. It was ridiculous. I was invited by a (former) friend who tried to recruit me and make some money exploiting me.

paulpauper2• 5 years ago

I think there is more that is not being disclosed. It seems hard to believe someone could be so public and just vanish like that after having stolen so much.

encryptluks22• 5 years ago

Cryptos have become more like a cult than actual tech. Don't get me wrong, some of them are legitimate but try pointing out their deficiencies in their communities and you'll get attacked from all angles. Most people involved in crypto aren't there for the tech, they only care about money they are making from it.

PMan74• 5 years ago

Most people involved in tech aren't there for the tech, they only care about money they are making from it.

(And there's no judgement in that, if you make a living selling fridge freezers it doesn't mean you have to care much about fridge freezers)

encryptluks22• 5 years ago

That assumes there is no harm in what they are doing. A lot of these cryptos are more like pyramid schemes. Selling freezers is one thing, but if you know the freezer has some major defects and you continue selling them telling everyone how great they are while misleading them about issues then it is more like a scam. Don't get me wrong, some cryptos have the potential to make a lot of people money but often the people making the money are the initial investors not the public.

deckard1• 5 years ago

I mean. Yes and no. Someone doing some CRUD apps at some car insurance firm just to put dinner on the table is completely fine.

But then you have Theranos and WeWork and all of that late '90s dot-com crap. Most of those companies had nothing to do with tech, but still raked in lots of VC money hoping to sucker people into purchasing their worthless stock after their inflated IPOs.

Of course, it has to be mentioned that the line between fraud and value gets incredibly fuzzy in tech. So much tech is "solutionized" into products that solve problems that are nonsense to begin with. Everyone believes they need cloud-this, or managed K8S, or auto-scaling whatever. The whole industry looks like a fraud at times. Especially enterprise marketing and sales. IBM, Oracle, and others have made a racket on this. And yes they have actual products with actual features, what they are selling are dreams and fairy tales. Look closely at crypto and you'll see the same cottage industry around it today. I mean, what is NFT other than credit default swaps (CDS) for the art market? It's abstracted ownership ("ownership" with a huge asterisk next to it). You even have initial coin offerings (ICO). Every thing from the dot-com and 2008 financial engineering crisis have all been replicated in crypto.

PragmaticPulp• 5 years ago

At least within my bubble, the people I know who spend the most time trading cryptocurrencies hold no illusions that cryptocurrency and utility tokens are actually useful. They approach it like a game: Try to spot the next big hype cycle before everyone else, then try to exit the trade before the hype dies out and the price retreats.

It's like trading stocks, but without any fundamentals or underlying value to interfere with the "to the moon" narrative.

andrepd• 5 years ago

There are definitely fundamentals, there's no point pretending that there are not. But at this point it's now buried under mountains of hype, and has balooned to many times its reasonable price (again, reasonable in terms of fundamentals/utility, not speculation).

blocked_again• 5 years ago

Most people involved in crypto aren't there for the tech, they only care about money they are making from it.

Most people involved in anything aren't there for the thing, they only care about money they are making from it.

There. Fixed it for you.

TheManInThePub• 5 years ago

You appear to have casually dismissed research scientists [*wave*], healthcare professionals, teachers, artists and many others who entered their field not for the money, but to do a 'thing' that benefits society.

Not everybody on this forum worships at the SV altar of capitalism :-)

henvic2• 5 years ago

Once the Bitcoin & cryptocurrency proof-of-work fraud dies off, we're going to hear a lot of stories like this.

https://henvic.dev/posts/bitcoin/

RivieraKid• 5 years ago

You're the author of this article? I really enjoyed it. One thing I'm not sure I agree is that fiat is an unsustainable shitcoin. Economics and monetary policy is a complex topic, some very smart and knowledgable people have a different view.

henvic2• 5 years ago

Yes, I am. Thank you!

Regarding sustainability, I'd say it depends a lot on what you're considering sustainable.

Both state-issue and Bitcoin might survive forever... It's just not the best for the common people who owns them, given they could've been using something that has a backing. Only time will tell.

puranjay• 5 years ago

“Hey hey heyyyy”

ivantopalov• 5 years ago

I wish people would stop associating this fraud with the cryptocurrency phenomenon. This had nothing to do with crypto. It was an ordinary ponzi scheme, they just added "coin" to the end of their product's name because at that time cryptocurrencies were already very popular.

II2II• 5 years ago

As an outsider, cryptocurrencies appear to be an ideal environment for fraud: most of the talk is around investing in it, its value is highly speculative, and it has relatively little uptake for its stated purpose. Even when a give cryptocurrency is legitimate, something that is difficult to discern through all of the noise, the instability in its value makes it a target for fraud.

zmix• 5 years ago

LOL, I never heard about OneCoin!

woodpanel2• 5 years ago

Interesting how on a per-capita base, Germany where I live, seems to be the most gullibe society. I think it is not a coincidence that Ruga lived and worked in Germany prior to OC most of her life.

I was almost sucked into OC. Some non-tech friend in his mid-thirties approached me about it, he had already invested all his savings (~20k€ and another 10k€ from his mother).

He gave me OC's prep-talk and got me interested, so as an overpaid programmer within minutes I've concluded: Why not buy the biggest package or even more?

Hooked as I was, every piece of due dilligence I've tried to apply made the whole thing appear as a scam quickly. I've phoned with the BaFin (our financial authority) multiple times it took about a year afterwards for a very timid response against OC (in hindsight their lack of action in this case mirrors their lack of competence in the wirecard scam).

For me there are two major culprits:

1. OC leadership, especially Ruga

I think what makes OC so sinister is how they specifically targeted groups of people with low technical knowledge and who feel (and are) financially unskilled / underpriviledged. Once they've had to flee one country they've moved to another nation, again looking for underprivliged non-technical people.

The OC footsoldier's that I've met all came from Germany's lower classes (I guess most marketers are victims as well).

In Britain they've targeted mostly muslims. They went to India, China and so forth.

2. Financial Authorities

A scam that targeted small time investors (entry package was 500€; who often don't even know the name of their financial authority or what it does) highlights the importance of taking action for a BaFin: A fair society cannot treat predation of poor people differently that that of rich people. Swifter action whould have prevented a lot of the levels that pyramid eventually built up.

500€s or 5.000€s in damage apparently isn't much for the BaFin to do a lot (AFAIK none of the footsoldies I've met faced any criminal charges). But for the victims it often amounts to 100% of savings or even debt they took on, not even to mention ruined friendships, self-doubt, guilt etc. Ruga and the BaFin broke already broken people.

PS: I think Tim Tayshun's article (https://news.bitcoin.com/beware-definitive-onecoin-ponzi/) must have saved a lot of people from this!

alisonkisk5• 5 years ago

There are similar scams in many countries. It's not a German culture thing.

woodpanel2• 5 years ago

I'm not saiying it's a German thing. Just that on the statistics mentioned in the article, my country seemed to be one of the more gullible ones.

I might also add: Wirecard as well as IOTA did most wreckage in Germany. Partly because their founders are German speaking. Partly because authorities are inept.

TazeTSchnitzel3• 5 years ago

Sounds a lot like Bitconnect.

fortran77• 5 years ago

"That ticked a box... The power of the woman - well done! I felt proud of her."

People really want to believe. It reached a different group than Theranos, but the setup was the same.

Obviously, if there was no way to take money out/sell your shares, the valuation was completely bogus.

MVorlm• 5 years ago

In case anyone is curious. ColdFusion did a video on her: https://www.youtube.com/watch?v=64xcgvEJ3Ys

ejanus• 5 years ago

But there may be cases where cryptocurrencies have some edge: transparency, speed and reach. Few days ago someone in India opened a contract to raise fund for covid ravaged cities. It is easy to see the amount contributed and by who. If that guy had opened a special bank account, nobody would know the amount collected except what he declares. Crypto kings all over the world emptied their wallets, I don't think such would have been possible under normal transfer systems. With cryptocurrencies the recipients don't pay any charges. But in some countries you may pay up to 50usd for every 1000usd.

snypher2• 5 years ago

The recipient surely has to pay a % exchange fee as they can't really buy anything with the crypto directly. If they do buy with crypto, they pay a transaction fee.

pajko• 5 years ago

Promoters of Crypto Ponzi Scheme OneCoin Murdered in Mexico (2020) https://www.coindesk.com/promoters-of-crypto-ponzi-scheme-on...

Cryptoqueen: A woman scammed the world, then vanished (2019)

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