Business News of Sunday, 2 December 2018
Some victims of an alleged cryptocurrency scam have denied suggestions that they were driven by greed.
The virtual currency trading firm, Global Coin Community Help (GCCH), allegedly offered investors 27% interest on their principal investments every month for a year.
The principal investments of the depositors and interests payments by the company would then expire after a year with depositors expected to earn back their investments after just four months.
Over 110,000 depositors are reported to have been duped of their investments, said to be in the region of GH¢135 million.
One of the investors, a chemical engineer, Richard Arthur, said on Eyewitness News on Friday that although they knew the risks of such a scheme, assurances had been given of its credibility.
“As much as people think that it was greed that drove many people into this, that is not entirely so. We knew the risks, but this was a scheme where the risk window to some extent was controlled.”
“Not many of us understood cryptocurrencies so it was a no-go area for some of us. The idea that was sold to us was that, the company would be the middleman and bridge the gap. They would go into the crypto world where they understand [how things work] and make the money, more than what you will get but you’ll be guaranteed a minimum of 27%.”
According to Mr Arthur, a number of investors were convinced to make deposits after attending seminars organised by the company across the country, with alleged beneficiaries of the scheme sharing their success stories.
“People heard of it through seminars organised by GCCH staff and even the owners and directors themselves, through testimonies from beneficiaries.”
“Many others got to hear of it by riding on the integrity of people they trusted to hold their interest sincerely. There were many seminars in Tema, Accra, Haatso and Nsawam. At no point was it ever mentioned that we should bring in our money for coins and we’ll be given coins back. What we were told was ‘cash in, cash out’.”
Another investor, Adesogyi Adeboye, said he had been introduced to the scheme by a “doctor-friend” of his who told him he had been investing for three years, a claim he later found out to be untrue.
“He was lying because he wanted me to invest so that he could benefit from me; because when you introduce someone, you get something.”
“I started with 15, 000 and did 10, 000 for my old girl as well. I owned my chemical shop which was deteriorating. I decided to sell everything in the shop and invested it. When the dividends started coming in, I started the renovations. I was halfway done when the EOCO issues started. “
The recent struggles of gold dealership company, Menzgold, and a number of microfinance institutions caused some worry among the investors, but the company dismissed these concerns assuring them that government had no jurisdiction over cryptocurrency.
According to them, they have petitioned the Securities and Exchange Commission (SEC) in a bid to compel the company to pay back their principal investments.
The Economic and Organised Crime Office (EOCO) is currently investigating the matter, and has already invited the two directors of GCCH, Kwaku Damete Kumi and Mr. David Opatey, for questioning.
The Executive Director of EOCO, Mr. K.K. Amoah told the Daily Graphic that the two have been granted bail but will report back to the Office next week.
He added that despite reports suggesting that 110, 000 persons have been affected, the number is expected to rise as more depositors continue to come forward.
“Yes, we have arrested them and released them after thorough interrogations and we have asked them to report again next week to continue with them.”
“We get a fresh list of depositors who have been swindled one way or another every day, and so the 110,000 figure is likely to go up by the end of the week and the amount of deposits would likely go up. There are several other syndicates of this type we have arrested and they are being questioned and very soon they will be arraigned,” he added.”
According to the report by the Daily Graphic, most of the investors were military personnel, medical doctors, police officers, Immigration officials, teachers and traders.
The GCCH offices at Nsawam in the Eastern Region and Haatso in Greater Accra have since been closed down.