CRYPTOSHARES

DESCRIPTION OF EVENTS

"[Cryptoshares] is an online crypto currency trading company that allows one to purchase investments in the form of bitcoins and manages / trades on your behalf to generate profits." "With a minimum in[i]tial investment of $50 worth of bitcoins, you can enjoy passive income (profits)." "Martin Mhlanga, a Zimbabwean based out of South Africa, is the mastermind behind Cryptoshares."

"As one native report explains, Mhlanga had efficiently used a sequence of unrealistic guarantees to lure many unsuspecting folks into investing." "For instance, the report explains that many of the victims had been lured into investing by claims that initial Cryptoshares investors were receiving a monthly membership payment of $2,000. Investors were also promised a payout that is double the amount of the initial investment."

"According to investors, how this scheme worked is that you first had to pay a $30 joining fee, and then a $300 initial installment which was then given to the person who had successfully brought in an investor. Another report also says that the investors were promised a $2000 membership payment every month. Another tactic that CryptoShares used was to prmise their investors a payout of double their initial investment." "Mhlanga kept coming up with new ideas to fleece investors, such as on its aniniversary, where users were asked to make another $1,000 investment and they would be paid $2,000 after one month."

"It is alleged that over 50 Whatsapp groups for Cryptoshares exist, where it is thought the platform carries the activities."

“Initially, I believed him because I saw a lot of testimonies in his WhatsApp groups not knowing that those who were testifying for getting thousands of payouts were his workers meant to deceive us.”

"Believing that they too would be in line to receive the same monthly payment, some of Mhlanga’s victims are thought to have sold their properties just so they could raise the required money. Others are thought to have borrowed the required initial investment from banks."

"Mhlanga has been postponing the payments dates since July 2021, giving different excuses until early September 2021 when he told investors to pay 10% of their money that they had invested for him to be able to unlock his account and make all payments."

"However, once September 1 — the day investors were supposed to receive their payout — rolled around, it dawned on many Cryptoshares investors that they had been scammed. In fact, as one Twitter user, Tendai Tomu points out, the early signs that the company was collapsing were seen towards the end of August when Cryptoshares was having problems paying investors."

"According to a local daily, Thomas Mhlanga, the person who began the scheme, can not be found and claims his account has ‘been locked.’"

“I am a Zimbabwean who is based in South Africa, I was supposed to get my first payout of the amount I invested in July, then I will be getting that same amount every month, but now Mhlanga is nowhere to be found,” one of CryptoShare’s victim said.

"Reports from Zimbabwe suggest that an individual by the name of Martin Mhlanga has disappeared along with over $6 million in investor funds. In addition to Mhlanga’s disappearance, the individuals thought to be managing Cryptoshares’ social media channels have similarly vanished."

"In a twist, more Whatsapp groups are being formed to trace the runaway Mhlanga."

"While the report suggests that some Cryptoshares investors have reported this fraud to law enforcement, many in Zimbabwe’s crypto space insist such a move will not yield much." "Others like lawyer Prosper Mwedzi have suggested reporting the fraud to cryptocurrency exchanges. However, still others insist such scams will recur unless more is done to educate people about the basics of investing."

"Sad indeed! I don’t think the funds will be returned because remember he was paying early investors with deposits from new ones so the equation will never balance. The best people can do is to learn from this."

CryptoShares was a scheme run primarily from Zimbabwe by Martin Mhlanga. Investors were promised significant returns of $2000/mo, in exchange for an upfront payment of $330. No payments were ever received, and the founder disappeared on September 1st. It does not seem like anything will be made right for affected users.

HOW COULD THIS HAVE BEEN PREVENTED?

The promises of CryptoShares were unrealistic. Having a large scale of investments occuring outside of any oversight and no widespread way to validate if a scheme is legitimate means that victims often have few resources to turn to when making decisions. Greater resources and education could greatly diminish the success of such plans.

Check Our Framework For Safe Secure Exchange Platforms

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