São Paulo — The Civil Police of the State of São Paulo is to investigate an alleged financial pyramid scheme involving the false marketing of cryptocurrencies, which motivated more than 500 consumers to file a complaint against the company MSK Operações e Investimentos, complaining that they have not received the funds invested.
Procon-SP, a consumer protection organization, said on Monday (21), that it sent a letter about the case, last Friday (18), to the Department of Policy for the Protection of Citizenship of the Civil Police.
In December last year, Procon-SP says it received 39 records against the company; in January this year, there were 172 cases and in February — just until the 17 — there were 337 complaints. The complaints are being forwarded to the Civil Police for criminal investigation, according to the entity.
Bloomberg Línea tried to contact the company by cell phone and e-mail on its website, but was unsuccessful.
In January, Procon-SP signed an agreement with MSK establishing that the company would reimburse consumers for the full amount invested and would strengthen its in-person service channels.
“Although the agreement provides for the return of the amounts as of March, Procon-SP decided not to wait for this deadline considering the significant increase in the number of complaints registered and the need to preserve consumer rights,” said the agency.
The person responsible for MSK would be the trader Saulo Gonçalves Roque, according to a report published by the portal R7 last February 14 (“Customers denounce cryptoactive company for closing and ‘disappear’ with investment”), citing an anonymous source, only identified as a client of MSK.
“According to him, MSK Invest has about 3,800 clients and the total loss to consumers would be more than R$700 million,” R7 quotes. That amounts to almost $140 million.
The case involving MSK adds to the list of allegations of fraud committed in Brazil by companies claiming to be bitcoin (XBN)operators and simply disappearing with the investor’s funds.
In a recent case, the Federal Police’s Operation Kryotos seized R$150 million ($130 million) from GAS Consultoria Bitcoin in Rio de Janeiro, which belongs to the so-called “pharaoh of bitcoins”. Other companies practiced the same fraud and damaged clients all over the country, a damage of billions.
The accusation against these companies is that they operate a financial pyramid scheme and not with cryptocurrencies. They always present the promise of great profits and then do not fulfill the contracts or return the amounts invested.
According to Francisco Gomes Júnior, a lawyer specializing in digital law, when investing in cryptocurrencies it is essential to check the reputation of the company, its corporate data, websites, contacts and the time it has been operating in the market, this prevents the interested party from being a victim of scams.
“Cryptocurrency operations are based on the law of supply and demand. The value of a bitcoin, for example, can vary up or down. So if someone offers a guaranteed profit, it is not a cryptocurrency investment. Another tip, if you happen to be a victim of a company that does not fulfill a signed contract, act quickly, because the chances that the company’s assets will disappear or prove insufficient to honor its commitments are great. Those who are quicker have a better chance of recovering the amount invested”, adds Gomes Junior, who is also President of ADDP (Association for the Defense of Personal Data).