- Key Coin Assets Ltd promised returns up to 100%, but
investors lost hundreds of thousands of pounds
- Insolvency Service investigations found no evidence of
genuine trading
- The Insolvency Service and Financial Conduct Authority (FCA)
are warning investors to be vigilant about similar offers
Would-be crypto investors are being warned to check firms are
registered after customers lost hundreds of thousands of pounds
to a Ponzi-style scheme.
Key Coin Assets Ltd told investors it could guarantee returns of
40% to 100%, with one online post claiming 0 Fees, 0 Risks.
However, the Insolvency Service acted swiftly to have the company
shut down when it found no evidence that any trading actually
took place.
Nine investors who complained to Action Fraud paid more than
£300,000 to the company between them, investigations revealed.
Key Coin Assets Ltd was wound up at the High Court in London on
Tuesday 11 August.
Now, the Insolvency Service and FCA are warning others to be
cautious of similar offers.
Anyone thinking of investing in crypto should check the FCA's Firm
Checkerto see if the firm is registered, which means it has
been through some FCA checks, and see its list of unauthorised
firms to avoid.
Consumers should be wary of guaranteed high returns and think
twice if a firm asks them to avoid normal payment references or
pushes them to recruit others.
Mark George, Chief Investigator at the Insolvency Service, said:
Key Coin Assets Ltd promised guaranteed returns but delivered
nothing. Their behaviour displayed all the hallmarks of a
Ponzi-style scheme.
Investors were told their money was being invested in crypto, but
our investigation found no evidence of any genuine trading at
all. Instead, funds were simply moved into the director's
personal account, often within hours of arriving.
We would urge anyone considering a similar offer to check whether
a firm is registered before handing over their money, and to be
deeply sceptical of anyone promising guaranteed returns with no
risk.
Insolvency Service investigations found that money paid in by new
investors appeared to have been used by Key Coin Assets Ltd to
pay off earlier ones.
Bank records showed funds were moved quickly into the personal
account of the company's director, often on the same day they
arrived, and then became difficult to trace.
The company also posted fake customer testimonials online without
permission, and told investors to avoid using words like crypto
or investment when making bank payments, in a bid to escape
scrutiny.
Accounting records were not handed over to the Insolvency Service
when requested.
The company repeatedly changed its official address, including to
a flat whose occupants said they had never heard of it.
Filings at Companies House also claimed assets of up to £42
million, far higher than its actual banking activity suggested.
The Official Receiver has been appointed as liquidator of Key
Coin Assets Ltd.
Further information
