In another round of enforcement actions conducted by the North American Securities Administrators Association, Ohio regulatory authorities recently issued a cease and desist command to cryptocurrency company USI-Tech. This should come as no surprise to those who have kept up with the movements of the administration; recent announcements have made it clear that “Operation Cryptosweep” is working to target hundreds of cryptocurrency schemes operating all over the North American continent.
The letter comes in response to a complaint filed by a local investor anonymously known as R.V. The investor dumped $22,000 into the company, evidently expressing his interest in the “Bitcoin Package” that the company rolled out for investors in the middle of 2017. The cease and desist letter was delivered on the grounds that the company was involved in a multilevel marketing scam, or a Ponzi scheme.
The R.V. Case
Evidently, this investor attempted to withdraw his funds on numerous occasions, but was vehemently urged by the person who pitched the tip to the investor, a man by the name of Mark Grobril. When R.V. attempted to withdraw the funds, he was urged by Grobril to refrain from doing so. But following his successful withdrawal of some of his Bitcoins, the man became “angry” and “refused to answer his questions.
R.V. was successful in pulling much of his investment from USI-Tech in October of 2017, an investment of 58.5 Bitcoins within the “Limited Bitcoin Package” sold to him by USI-Tech. But in January of 2018, the website displayed that the investor had zero coins on the site, despite the fact that he supposedly still held significant money within the site.
R.V. was then unable to obtain any information from the site regarding the status of his money, and was prohibited from withdrawing anything from the account.
Grobril is clearly an executive leader within the organization known as USI-Tech. His social media refers to him as one of the “founding members,” and he was consistently a heavy promoter of the business.
This isn’t his first run-in with regulatory authorities, either. The “My Advertising Pays” Ponzi scheme was heavily promoted by the entrepreneur. The founder of USI-Tech stands accused of defrauding investors of an untold but likely significant amount of money, alleges the Ohio Department of Commerce.
Cease And Desist
The Securities Division of the Ohio Department outlined several charges against the corporations as justification for its cease and desist order. Specifically, a lack of substantive information regarding the background and experience of the founders of the site drew significant red flags.
Furthermore, the regulators outline that the company failed to disclose the parties in charge of their bitcoin mining contracts, information regarding both the assets and liabilities of the company, and the “risks associated” with the bitcoin package sold to investors such as R.V.
As the investigation moves forward, securities investigators will likely need to press harder than they have previously in order to force an official response from the company. Cease and desist orders previously dulled out against the organization had been ignored entirely, and the major leaders in charge of the scam have gone into hiding.
The regulators tasked with breaking down this monster scam have a tough and long road ahead of them as NASAA continues their efforts in “Operation Cryptosweep.”