The company was attracting investments on the basis of lies and scams
The Texas State Securities Board recently issued a cease-and-desist order against Arkbit Capital, which is accused of committing fraud while conducting cryptocurrency cloud mining operations.
The order states that Texas State Securities Board Financial Examiner Alexis Cantrell uncovered evidence that Arkbit Capital and its connected entities committed fraud to promote its investment products, including manipulating videos and using misleading images.
Arkbit Capital, Arkbit Capital Holdings, ABC Mining, and ABC Holdings LLC also falsely claimed they operated cloud mining data centers in Arkansas for multiple cryptocurrencies.
Products were offered promising investors daily returns of 1.6-2.8% for 120 days on crypto deposits between $50 and $49,999. Arkbit Capital was also accused of using CoinPayments.Net to handle payments, although the processor’s policy restricts users from the US and other countries from the platform.
Paras Khivesara was discovered as the holder of the Arkbit CoinPayments account and is based in Hyderabad, India, rather than Arkansas. The investigation also found a manipulated video showing Arkbit Capital’s CEO, Delmar Estabrook, speaking at a cryptocurrency conference in Austin, TX, when no evidence was found that he attended.
Joe Rotunda, Director of the Enforcement Division of the Texas State Securities Board, recommends that citizens be wary of social media investment possibilities and thoroughly research companies before sending any funds.
Several other crypto Ponzi schemes have also been uncovered recently in the US. The Securities and Exchange Commission (SEC) discovered a $300 million Ponzi scheme on March 15 employed by the CryptoFX platform that targeted Latino investors in the US.
Three days later, a jury in New York convicted two persons acting as promoters for IcomTech, which conducted a fake crypto trading and mining scheme.
