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from the paying-a-large-"bill"-for-a-bitcoin-scheme dept.
Arthur T Knackerbracket has found an interesting story: Bogus Bitcoiners battered with US$12 million penalty in The Register.
The US SEC (Security and Exchange Commission) won its case against two Bitcoin companies — GAW Miners and ZenMiner — operated by Homero Joshua Garza that bilked 10,000 investors out of about $20 million in what was essentially a Ponzi scheme. The companies purported to sell shares in cloud-based Bitcoin mining machinery, but "the companies never owned enough computing power to be serious miners." The companies were hit with a $12 million penalty. Garza is not, however, off the hook as he is facing a separate criminal trial and he is in talks with the SEC about how to handle the claims lodged against him.
Here's the literal money quote:
Ironically, the Bitcoin price ended 2015 bouncing between US$400 and $450. Had the two companies simply bought Bitcoin with their $20 million, on today's $2,740 price for the crypto-currency there'd be around $140 million in the kitty.
(Score: 2) by Unixnut on Friday June 09 2017, @10:00AM
> Had the two companies simply bought Bitcoin with their $20 million, on today's $2,740 price for the crypto-currency there'd be around $140 million in the kitty.
Yeah, or Bitcoin could have plummeted to near zero USD, losing all the money. It is easy to see the "wise investment" in hindsight. BTC could have collapsed just as easily (if not moreso) than it has risen.