- A cryptocurrency debit card scam that has targeted residents of Austin, Texas has been halted by the Texas State Securities Board
- The scheme claimed to bypass taxes and guarantee monthly income
- Texas has a history of protecting residents from crypto scams, including BitConnect in 2018
A cryptocurrency debit card scam that is targeting Texas residents has been issued with a cease and desist order by the Texas State Securities Board (TSSB). The agency has taken issue with Lance Jerrard and his range of South African companies under the Liquidity name, accusing him of fraud and selling unlicensed securities after Austin residents were targeted with a cryptocurrency debit card scam that promotional material claims will result in guaranteed monthly income and bypass taxes.
Cryptocurrency Debit Card Scam Uses Crypto “Hype”
According to the TSSB order, Jerrard has been using local radio and social media to recruit residents of Austin to promote and sell the scheme in typical pyramid fashion. His companies, Liquidity Gold Trust, Liquidity Gold Solution LLC, and Liquidity Global Card Solution (PTY) LTD, represent something of a throwback to 2017, using cryptocurrency buzzwords to try and bamboozle unsuspecting individuals into being recruited to promote the cryptocurrency debit card scam.
The TSSB accuses Jerrard of “allegedly attempting to capitalize on the hype” of blockchain and cryptocurrencies by promoting a scheme that utilizes stablecoins over regular cash, which his promotional material claims would bypass taxes otherwise due on crypto sales when the card is used to purchase items.
TSSB Scores Another Victory
The order claims that Jerrard is essentially running a Ponzi-type scheme, with a regular influx of new customers needed in order to generate the fees that make up the “guaranteed growing monthly income”. It also accused Jerrard of “intentionally failing to disclose material facts” relating to the cryptocurrency debit card scam, such as other costs, restrictions, and useability of the cards.
Texas has a strong record when it comes to protecting residents from potential crypto scams, with numerous cryptocurrency scams shut down by the TSSB, including MCcoin and cloud mining firms AWS Mining and My Crypto Mine. They were also instrumental in bringing BitConnect down, issuing a cease and desist order in January 2018 which was the beginning of the end for the scam.