Vietnamese Crypto Firm Duped Investors Of $660M USD In ICOs

Crime, ICO News, News | April 12, 2018 By:

Modern Tech, a Vietnamese IT firm, has gone silent after allegedly deceiving 32,000 people into investing an estimated VND15 trillion ($660M USD) into two fake initial coin offerings (ICO).

Ifan and Pincoin were allegedly multi-level marketing Ponzi schemes under the control of Ho Chi Minh City’s Modern Tech. Ifan, which is registered in Singapore, was advertised as “the most advanced social network” targeted towards celebrities and artists to help them connect in a better way with their fans. Pincoin, which is registered in Dubai, promised profits of “up to 40% monthly” through a range of bonus structures that favored early investors over later ones.

On Sunday, dozens of people protested at the headquarters of Modern Tech in Ho Chi Minh city’s District 1, carrying banners with the phrase “biggest digital money fraud in history.” Victims are demanding refunds from the company for the cryptocurrencies it claimed to represent. They claimed to have been invited to various conferences held by Modern Tech as it was attempting to mobilize capital.

Suspicions first arose among investors when the company began to stop paying commissions in real money, but in tokens. Investors could see the value of their investment rise on a daily basis in the dashboard, but they could not withdraw a dime in fiat.

According to local media, the owner of the Vietnamreal building, where Modern Tech was initially headquartered, said that the company had moved out in early March.

“Modern Tech left and liquidated a contract about one month ago. No one knows where they are now,” said the office building owner, who declined to be named.

Lê Thanh Liêm, standing vice chairman of the city People’s Committee, has sent an urgent letter to the city’s police, requesting them to launch an investigation. The city’s police chief said they are gathering information about the case, but officially they haven’t launched an investigation until they receive accusations from any of the alleged victims.

In a directive, Prime Minister Nguyen Xuan Phuc told the State Bank of Vietnam, the Ministry of Public Securities and other bodies to tighten the “management of activities related to bitcoin and other cryptocurrency.” The prime minister told the central bank to instruct banks not to provide any payment services related to illegal cryptocurrency transactions. He also ordered the Ministry of Justice to complete the legal framework for managing and dealing with digital assets.

Currently, all transactions in cryptocurrencies are illegal in Vietnam. In October 2017, the central bank announced that from January 1, 2018, “the act of issuing, supplying, and using illegal means of payment, including bitcoin and other similar cryptocurrencies, may be subject to prosecution.” Those providing “unlawful means of payment” (cryptocurrency) may also be subject to a minimum fine of 150 million dong ($6,600 USD).