Nov 2017 - Optioment Bitcoin Ponzi Scheme

$136 313 000 USD

NOVEMBER 2017

GLOBAL

OPTIOMENT BITCOIN

DESCRIPTION OF EVENTS

"Optioment was a Bitcoin exchange started in 2016 and claimed to be “based in Costa Rica aiming to generate competitive returns by investing Bitcoin in safe arbitrage trading.”" "Officially, Optioment was registered in Costa Rica. However, data from the Alexa website show that visitors to the Optioment website came almost exclusively from Germany and Austria."

"BITCOIN TRADING... is the most lucrative profit earner in the world!" "At OPTIOMENT, we apply our strengths as a leading global Bitcoin investment project to deliver solutions, unlock value and propel growth." "The OPTIOMENT Bitcoin project is a private Costa Rica-based Bitcoin fund that aims to generate competitive returns by investing Bitcoin in safe Arbitrage- and manually controlled Crypto-Trading. Arbitrage-Trading takes advantage of the value disparity of one specific share at the different global exchanges. Manual Crypto-Trading is investing in a market, which produces enormous returns."

"The Bitcoin fund’s small management and trader team consists of well-educated and seasoned professionals with deep knowledge of Arbitrage Trading and markets. Our focus on protecting client’s Bitcoin deposits is reflected in our business model, our process and our people. We understand the needs of our members for targeted investment solutions and attractive risk adjusted returns."

"We HELP you to use this CHANCE! The OPTIOMENT-Technology enables EVERYBODY to get his or her share in this new, emerging market!" "EARN Bitcoins EVERY DAY! The software is generating 1.5% until 4% Bitcoin REVENUE per week ! You just need to watch your Bitcoins GROW!" "We pay you between 1.5%, 2% or 4% interest on your Bitcoin deposit every week during our deposit times from half a year, one year or two years."

"EARN even MORE Bitcoins... by teaming up in our affiliate network!" "By sharing the OPTIOMENT project with your friends, you will earn Bitcoins handsomely. Our multilevel commission plan will pay you 7% for the 1st level, 4% for the 2nd level, 3% for the 3rd level referrals and even more!"

"Everyone has different plans for the future, and this variety of life goals is matched by an equally diverse range of needs when it comes to financial planning and security. The OPTIOMENT project is designed to help you meet your own specific needs."

"We take a lot of measures to reduce the risks for our members. We put a certain percentage of our Bitcoin Earnings to a deposit reserve and we do our Trading with a sophisticated, unique software. This ensures that your Bitcoin – deposit is as safe as possible."

"Your anonymity is most important for us. We will never ask any personal data nor proof of origin from you." "The OPTIOMENT project is open to everyone, regardless of sex, skin colour, race, political or religious views. You are more than welcome to be part of the OPTIOMENT family!"

"We have built the project on a strong foundation of intellectual and financial capital. We focus on attracting exceptionally talented people and on creating an atmosphere that rewards initiative and independent thinking. Our solid financial base ensures our capacity to deliver on our commitments."

"Above all, we have made it our top priority to serve the needs of our members. This commitment is reflected in a culture that values integrity, professionalism and a passion for excellence. It also leads us to operate with prudence, financial discipline, a long-term perspective, and a clear understanding that trust is something we must earn every day."

"Deposits are made through Bitcoin, that makes taking part in OPTIOMENT easy, quick and safe. What else could you ask for?" "SIGN UP NOW AND GET FULL ACCESS"

"When the VALUE of the Bitcoin... is up to $10,000 and more, only one question remains: How MANY Bitcoins do I own then?!"

"FinTelegram is reporting about @cointed and @derbrutkasten. We received confirmation and documents that #Cointed paid for the "all-is-perfect" PR articles during the #ICO. It was actually paid PR content without disclosure. #fraud #optioment" "A closer look into the Internet Archive reveals that Optioment was one of the partners of Bitcoins Verdienen. Bitcoins Verdienen regularly conducted Optioment events to drive people into this Crypto-MLM."

"According to the Austrian newspaper Die Presse, Optioment facilitated several cryptocurrency events in the country in which over 700 people participated; the company promised high returns for investors resulting in it being attractive to a lot of people who put their bitcoins in the scheme." "The largest investor event organized by Optioment occurred in the weeks before its collapse, where 700 participants turned up at a hotel in Vienna. The investment scheme also saw its network expand to investors in Poland, Romania, and the former Yugoslavia." "Anyone who brought their friends into the system was rewarded with additional payments."

"According to the descriptions of those affected, there were also several meetings where the system was advertised. The operators have apparently proven sense of black humor. Because some of these meetings took place in the event pyramid at the SCS in Vösendorf south of Vienna."

"But the website of Optioment has now disappeared. Videos and forum entries in connection with the platform were also gradually deleted on Wednesday [January 31st, 2018]." "According to APA information, those affected pointed out that Optioment offers deposits and investments in Bitcoin with half-yearly, annual, biennial interest, etc. and can no longer pay. The FMA now suspects fraud, pyramid play or violation of the Capital Markets Act due to a possible violation of the prospectus obligation. The Optioment homepage was no longer available on Wednesday afternoon. ( APA, January 31, 2018 )"

"[T]he website’s operators ran away with user funds." "There were also withdrawals for a few months. Until the system suddenly collapsed at the end of November 2017." "While payouts were made for several months, the multi-level marketing scheme ultimately collapsed in November 2017. Toward the end of January, Austria’s Financial Markets Authority began collaborating with the prosecutors’ office in Vienna to carry out an investigation on the suspicion of fraud and/or pyramid play, the Die Presse report added."

"At the end of November, however, promised payments were not made. As a result, a number of people affected filed a complaint, for example at local police stations and financial market supervision ( FMA ). At the end of January, the public prosecutor's office addressed the facts." "Ronald Frankl has been dealing with the Optioment mesh since the end of December when three first victims approached him and sought advice. The firm now represents a good 150 people affected in order to achieve compensation for them. In a first step, the Lansky partner strives to enforce claims through criminal proceedings as private parties."

"We have been warning of such multilevel fraud for years. Unfortunately, the knowledge of many people regarding bitcoin and cryptocurrencies is often very low, which makes them easily victims of such dubious offers, says Johannes Grill, President of the lobby club Bitcoin Austria for the press : It is completely unknown and cannot be proven whether Bitcoin was ever traded. The money of the investors in Bitcoin was primarily accepted. The commissions for the recruiters were also paid out in Bitcoin. We suspect that trading never took place, but that the users were paid out with the money of new investors as is customary with such systems."

"Details are emerging about an Austrian investment scheme, dubbed “Optioment”, where its operators have reportedly stolen some 12,000 bitcoins (approx. $116 million in current prices) from over 10,000 victims invested in the scheme. The scheme ran a website, now offline, claiming to be a ‘premier global Bitcoin investment product’ stemming from a ‘private Costa Rica-based bitcoin fund’. The scheme also claimed to have its ‘investment’ platform backed by assets over 35,000 BTC." "Most of the victims of this scheme are from Austria while others are from Germany, Romania, Poland, etc."

"Investigators at the Vienna State Police Directorate assume that affected investors are located in Austria as well as in Germany and Turkey; they expect a Europe-wide network. An event in Vösendorf near Vienna is said to have visited 700 interested parties in November." "The FMA did not want to give the exact number of complaints. Just so much: The operators were obviously very broad when it came to acquiring customers. However, they have stopped payments for about two months. The customers were apparently held up with perseverance slogans.

"In addition to Lansky Ganzger, other law firms also look after battered investors. Around three dozen victims from Linz and Graz are behind inquiries that have been addressed to SCWP Schindhelm since December. The contact to the law firm included a recommendation from the existing clientele. Before the end of the year, the partner sent Dr. Markus Nussbaumer and lawyer candidate Philipp Leitner for a group of affected letters of receivables to the Optioment sales people. However, there is currently no specific mandate."

"The press, together with the editorial team of the ORF program Eco, viewed around eight gigabytes of documents, photos, chat protocols and videos – and interviewed more than 30 investors. Some of them were also active in sales because Optioment's sales were structured as a multi-level marketing system."

"#European #Police are looking for #masterminds behind #Optioment #bitcoin #scam that had the most #victims in #Austria with possibly 10000 victims and 115 million involved. Scam promised up to 4% #weekly #profit for bitcoins #deposited." "[T]he government of Austria is seeking the help of Interpol to track down scammers who stole more than $155 million worth of Bitcoin from hundreds or even thousands of cryptocurrency investors across Europe in a scheme called Optioment."

"Austrian financial watchdog Financial Market Authority (FMA) spokeswoman Christina Ratz told Bloomberg local police have already identified two people connected to Optioment, but no arrests have been made. Law enforcement, meanwhile, have asked the Interpol to search for other suspected members of the company in neighboring countries including Denmark, Latvia, and Germany."

"AUTHORITIES EXECUTED SEARCH WARRENT IN #COINTED OFFICE." "We have just been informed that on April 12, 2018, Austrian Authorities have executed a search warrant in the Cointed office facilities. This enforcement action was obviously related with the OPTIOMENT case. As reported already the Cointed co-founder Christopher RIEDER is one of several suspects in the OPTIOMENT case. According to some other suspected people RIEDER was one of the masterminds behind the OPTIOMENT investment scheme. RIEDER allegedly left Austria shortly after OPTIOMENT’s collapse and was not available for media since then."

"We then can tell you that we receive a lot of information about COINTED, OPTIOMENT, and Christopher RIEDER. Suddenly, it seems, all people have always known that this is a huge scam alltogether. Suddenly, all people seem to know that COINTED is of course involved in the OPTIOMENT case and operate their business with a questionable code of conduct when it comes to KYC, AML and investors protection."

"Yes, we are more than critical of COINTED and its awkward business practices. But we have to be fair when it comes to judgements. And, yes, we know that their ICO White Paper was full of false statements but we have to prove all those allegations. Hence, we cannot take all information we receive from our readers as “facts” and report immediately."

"What seems to be a fact, however, is that many partners claim that COINTED‘s Crypto-ATM business turned into a zombie, a living dead. Besides the fact that COINTED ATM’s are still in use for questionable money transactions, COINTED failed to deliver their Crypto-ATMs to partners and actually, nobody knows who produces those machines. Rumors say that it’s a Novomatic Group company that produces the new generation of Crypto-ATMs but we have not been able to confirm this. The former partner General Bytes confirmed that they are standing up to their allegations against COINTED and thus will not deliver Crypto-ATMs (read open letter)."

"In Austria, two men from Styria and a Lower Austrian appeared as sales people for Optioment. The advertisements at the public prosecutor's office in late December go back to them. The three are currently partially exposed to personal attacks. So far, she has been the witness of the prosecutor's office, but a contribution to the crime does not seem to be excluded."

"Two Styrians and a Lower Austrian are believed to be backers. However, these speak of the fact that a Dane named Lucas M. and a Lette named Alex P. are the real responsible parties. The three Austrians have recently been represented by the Brandl & Talos law firm. The lawyers told the media that their clients "were not involved in the flow of payments" and had nothing to do with the disappearance of the assets."

"According to "Die Presse", the three Austrians argue that they themselves reported Lucas M. and Alex P. in December. However, there is doubt as to whether they exist at all. For example, the three Austrians have so far not been able to present a contract with the alleged "main persons. Photo evidence or contact details are also missing. In an ORF report, a video conference is presented with one of the alleged responsible persons –, however, only one voice can be heard, but no picture can be seen. So far there have been no arrests."

"So far we know that 2 guys named Lucas MAZUR and Alex POPOV are said to be the ones in the background, the phantoms coordinating the fraudulent crypto-MLM scheme. We are pretty sure that neither Lucas MAZUR nor Alex POPOV are real people. Lucas MAZUR is the name of a French badminton player whereas Alex POPOV was a Russian swimmer." "There are other names such as J. HEIMHILCHER, an Austrian citizen and resident, and the operator of the Austrian website Bitcoins Verdienen (www.bitcoins-verdienen.at). A closer look into the Internet Archive reveals that Optioment was one of the partners of Bitcoins Verdienen. Bitcoins Verdienen regularly conducted Optioment events to drive people into this Crypto-MLM."

"According to the Austrian prosecutor HEIMHILCHER regards himself as a victim of Lucas MAZUR and Alex POPOV. Consequently, his lawyers filed a criminal charge against them in January 2018 without being able to provide an address or any other credentials of these phantoms. It’s rather unbelievable that millions of investors’ money should have been transferred to completely unknown people without doing at least a minimum level of KYC which is the usual way if doing money business. You may ask yourself if you believe that."

"Above all, an overview is difficult because it is not so clear who is the perpetrator and who is the victim in the Optioment construct: Optioment was operated as a pyramid game: As is well known, such systems only get through the fact that the existing members recruit new people and make them pay contributions: "It is currently not at all clear, who is a victim and who is a perpetrator. A crime contribution may also be reported to people who have been harmed, "said the police spokesman."

"According to Bloomberg, the Austrian Federal Police have already identified two people who are accused of fraud in these complaints and are seeking to identify several others, including some outside Austria. Although no one has been arrested yet, the law enforcement authorities in Austria have also called Interpol to assist them in tracking suspects in Denmark, Germany, and Latvia." "The Vienna Public Prosecutor's Office received notifications against two suspected masterminds at the end of December 2017."

"Two of the three operators behind Optioment, a Danish national and a Latvian national, have been reportedly identified. As such, no arrests have been made, and FMA spokeswoman told Bloomberg. Still, the prosecutors’ office is going through “hundreds of complaints” from Austrian investors, leading to authorities pushing Interpol to help track down the operators of the alleged scam."

Optioment Bitcoin promoted that bitcoin trading was the most lucrative opportunity "in the world", and assured customers that they could consistently earn "between 1.5%, 2% or 4% interest" on "safe" arbitrage trading. They had a nice multi-level marketing arrangement which users could take advantage of for even more profit by referring their friends. They provided a nice spreadsheet where users could calculate their expected earnings based on the future bitcoin price. They were partnered with at least one exchange and held regular events to promote Optioment to new investors.

Ultimately the scheme collapsed, and users lost an estimated 12,000 bitcoin ($115m worth). Some sources state that the collapse started in November 2017, however I found promotions still running in late December 2017, and was unable to locate any referenced losses prior to January 2018. News reports in media started around February 2018. While the perpetrators may have been apprehended, there is no indication that any funds were recovered.

HOW COULD THIS HAVE BEEN PREVENTED?

Optioment Bitcoin was fundamentally flawed in that it did not have the purported revenue model. The primary prevention mechanism would be to enforce regular third party reviews of all platforms. Under our framework, 2 reviews by third parties would be required before a platform launched, and a third one after 3 months, which would report if all customer funds were fully backed or not.

Check Our Framework For Safe Secure Exchange Platforms

QUADRIGA INITIATIVE

CRYPTO WATCHDOG & FRAUD RECOVERY PLATFORM

A COMMUNITY-BASED, NOT-FOR-PROFIT

$136 313 000 USD

NOVEMBER 2017

GLOBAL

OPTIOMENT BITCOIN

DESCRIPTION OF EVENTS

HOW COULD THIS HAVE BEEN PREVENTED?

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