- The DOJ has accused the creators of DeFi platform HyperFund of running a $1.9 billion scam
- According to the DOJ, the creators are American and Australian nationals
- The DOJ claims that HyperFund promised investors returns from yet-to-be-established crypto-mining operations
The United States Department of Justice (DOJ) has accused three individuals of running a $1.9 billion scam in the guise of a DeFi platform dubbed HyperFund. The DOJ revealed that the trio promised investors high returns drawn from crypto mining operations, even though such operations were yet to be launched. According to the charges, Sam Lee, an Australian national, co-founded the platform while Brenda Chunga and Rodney Burton, American nationals, popularized the protocol.
Investments Would be Doubled or Tripled
In a statement, the Justice Department disclosed that the three operated the fraudulent scheme for roughly two years ending in November 2022. HyperFund ran an investment scam promising investors that their investment would initially increase by up to 1% daily as they waited for it to be tripled or even doubled.
Three Individuals Charged for Roles in $1.89B Cryptocurrency Fraud Schemehttps://t.co/T0S3F0xLa0
— Criminal Division (@DOJCrimDiv) January 30, 2024
The DOJ revealed that Lee, Chunga, and Burton failed to keep their promise and started blocking investors from accessing their funds, adding that they marketed the same platform under different names like HyperNation, HyperCapital, HyperVerse, and HyperTech.
According to Homeland Security Investigations’ Erin Keegan, law enforcement agencies in the United States are committed to “protect American investors from financial predators,” with the IRS Criminal Investigation Department’s David Meisenheimer adding that the country has the “tools and internal fortitude to protect [its] financial system.”
Over $100 Million from Big Butchering Scams Seized
The charges come as financial regulators and law enforcement agencies in the country increase their involvement in the crypto and blockchain worlds. In April last year, for example, the DOJ seized over $100 million in crypto from pig butchering scams.
The United States securities watchdog, SEC, on the other hand, has in the past accused multiple entities of operating crypto scams. Some of the entities include Forsage founders and Meta 1 project operators.
With the DOJ armed with evidence from multiple investigators, the trio will likely be found guilty.
