QUADRIGA INITIATIVE
CRYPTO WATCHDOG & FRAUD RECOVERY PLATFORM
A COMMUNITY-BASED, NOT-FOR-PROFIT
$13 300 000+ USD
JANUARY 2018
GLOBAL
USI TECH
DESCRIPTION OF EVENTS
"Transform Your Life with Our Innovative and Automated Bitcoin Trading Platform" "We've built the world's first automated trading platform for the Bitcoin currency and even the most experienced traders are jealous of our results." "Grow Your Bitcoins by 1% Per Day" "24/7 Account Access for Withdraws" "Secure Platform from a Proven Company" "35% Referral Commissions Over 12 Levels". "It’s called USI-Tech, short for United Software Intelligence, and according to the people plugging the scheme you can make a fortune for very little effort." "USI Tech (United Software Intelligence Technology) is a company that claimed to develop the world’s first automated trading platform for Bitcoin (BTC)."
"We pride ourselves in delivering a technology that you won't find anywhere else. We are enabling "smaller" investors to finally get involved in the FOREX and Bitcoin markets and have real success. Through the development of our fully automated trading software, we've consistently delivered out-standing results. And we are committed to continuing to do so far into the future. It is finally possible to get involved in these highly complex and highly profitable markets, without any expertise of your own."
"Starting in May 2017, USI Tech started concentrating on selling BTC packages to traders and miners who wanted to automate these activities." "USI-TECH has opened up the world of crypto finance (and the excellent profits that come with it) like no other company has before. For a long time the major players in Cryptocurrency have been the privileged, in-the-know few. But our platform is disrupting the entire industry."
"OUR CUSTOMERS HAVE ENJOYED PROFITS OF UP TO 150%! How is that possible? Our unique algorithms don't rely on common indicators, allowing them to deal with extreme market fluctuations and avoid incurring severe losses. By maximizing risk reduction in a highly volatile, fast-paced market environment, our software consistently provides returns of up to 150% per year."
“USI Tech has opened up the world of crypto finance and the excellent profits that come with it like no other company has before,” its website boasted. "We are enabling smaller investors to finally get involved in the Forex and Bitcoin markets and have real success". "We use unique algorithms and a conservative trading strategy to greatly minimize the risk to our users. In the worst case scenario, trading can be immediately halted at any time by stopping the software."
"USI-TECH is Your First Step Toward a Better Future..." "This opportunity truly is for everybody. The platform is simple and intuitive. And the autotrading feature drops the learning curve down to ZERO! Also, we won't charge you any start up or licensing fees to get going. Which means you (and your referrals) can start trading immediately with just €50 of starting capital."
"Take advantage of our unique referral marketing plan and earn above-average commissions without any qualification barriers. While generating up to 35% commissions on 12 referral levels, you'll be able to double your capital over and over again."
"The FOREX exchange market is the market with the highest capital turnover in the world. And Bitcoin continues to grow by leaps and bounds." "It is almost impossible to obtain enduring profits in these markets without professional tools." "More than 80% of traders lose money while trading, continuously, due to their lack of experience and other psychological factors."
"We offer the opportunity for you to get a piece of the pie -- regardless of your skillset or the size of your bank account." "Our automated trading system provides access to the most liquid market in the world with excellent profits for ANYONE." "Our experienced team of specialists is constantly optimizing the existing parameters of our software and exploring new strategies to guarantee long-term success."
"When you join USI-TECH, you'll gain our entire team's highly-skilled expertise and decades of experience. Through our unique, highly-complex algorithms the risk is effectively minimized, while the chances chances of profit are maximised. And still YOU retain complete control of deposits and withdrawals." "The company USI-TECH Limited, registration number ICC20160282, has its headquarters in Dubai"
"Our business is built around our customers. So every bit of our knowledge and expertise is passed down to you through our software and our service. We commit to the continuous development and improvement of our software with the goal of providing a consistent return on your capital far into the future."
"On behalf of USI-TECH Limited ("USI-TECH"), we welcome you as a new sales associater ("Sales Partner") and wish you every possible success in your role as an independent Sales Partner of USI-TECH, located at P.O Box 122036, Dubai UAE. And most of all – that you have fun selling our products. Here at USI-TECH, our primary purpose and goal is to provide an atmosphere dedicated to: (a) consumer-friendliness, (b) safety, (c) professionalism, and (d) a fair dealings with one another in the general environment of network marketing; and of course, while complying with the laws both foreign and domestic. For that reason, we would like you to read the following Terms and Conditions very carefully and to make these guidelines the guiding principles for your daily work."
"Risk Warning: Forex and CFDs are leveraged products and involve a high level of risk. It is possible to lose all your capital. These products may not be suitable for everyone and you should ensure that you understand the risks involved. Seek independent advice if necessary."
"[I]ts biggest draw was the "breakthrough" mining technology, which placed mining rigs in an underground vault in Iceland. USI Tech claimed the rigs could run for longer without overheating and, therefore, mine "14 - 16 bitcoin a day," which would put it in the top tier of mining operations in the world. It even published a video tour of the mining rig that featured clear USI Tech branding inside the facility."
"BTC packages started out at around 50 Euros each. The more packages you bought, the higher your return would be. USI Tech’s automated software was supposed to provide a way for users to make passive income. The returns (one percent daily payout on average over five days per week) sounded promising to some people. The company also claimed to offer a staggering 140 percent return over the course of a 140-day package. It also stated (without proof) that some people had already received 150 percent returns."
"USI Tech -- was paying real dividends on its customers' investments." "At least, it appeared to be."
"A lot of cryptocurrency project websites provide tons of relevant information about founders and team members. However, many also do not. In the case of USI Tech, the latter was true. On the project website, there wasn’t much info about who the USI Tech owners were. Furthermore, the site didn’t provide much information about the products that USI Tech was selling."
"What we do know is that Joao Severino and Ralf Gold founded the project. Before starting USI Tech, Severino was banned from all financial activity in Portugal because of his involvement with another scam company called AMC Invest. Even worse, Ralph Gold had been involved in all sort of Ponzi scheme companies. These included AdsProfitReward, MX Fast Money, World Consumer Alliance, HourlyRevShare, AdsProfitWiz, APR Clicks, and Upper Game."
"The company also claimed to be based in Dubai. However, the registration of the business is actually from Ras al Khaimah, another city in the United Arab Emirates that is well known for its offshore business registration services."
"October 2017: USI Tech starts the Tech Coin ICO. USI Tech users hand back over 11,500 BTC from the same payments they were receiving from multiplier packages and member purchases."
"Based on reports from Engadget, USI was initially promoted by Lee Oakey, Kerry Stockton, Rodney Burton, and Michael Faust. Oakey and Stockton are British, and currently live in Australia. Burton (49, in 2018), also known as "Bitcoin Rodney", was known for purchasing a $350,000 Lamborghini Huracan from Lamborghini Newport Beach in Costa Mesa, California, using Bitcoin. Burton was released from jail in 2010 after serving five years for drug dealing."
"Based on reports from Engadget, USI was initially promoted by Lee Oakey, Kerry Stockton, Rodney Burton, and Michael Faust. Oakey and Stockton are British, and currently live in Australia. Burton (49, in 2018), also known as "Bitcoin Rodney", was known for purchasing a $350,000 Lamborghini Huracan from Lamborghini Newport Beach in Costa Mesa, California, using Bitcoin. Burton was released from jail in 2010 after serving five years for drug dealing."
In one Facebook post, Oakey, from the United Kingdom, said that when you have an "amazing business" like USI Tech, "all you want to do is tell the world... so I did!"
"Stockton, who is also a Brit and -- according to her Facebook profile -- is in a relationship with Oakey, boasted that the company was changing lives. In one Facebook status, she posted a link to a USI Tech video and claimed a man had paid for his daughter's university education by investing in Bitcoin."
"Oakey and Stockton now live together in Australia."
"Dan Putnam, who identifies as the CEO of R&D Global, a suspected USI parent company, was also seen boasting that a mere $40 investment can grow to US$10 million in just 18 months at Eyeline Trading. Eyeline's homepage was redirected to USI Tech for a brief period, before also going offline. R&D Global is registered as a limited liability company in Putnam's home state of Utah under the name of Richard Theodore Putnam."
"In a YouTube clip of a USI Tech party on a Spanish island, [Michael] Faust said he'd recruited at least 3,000 investors." "USI Tech International had over 800,000 members. In the US, there were [members] in all 50 United States."
USI Tech "offered 35% commission if you roped in others and in [a February 2021 story by Andrew Penman he] told how the Mirror confronted two promoters who were trying to drum up new members at a recruitment session in a Merseyside hotel."
One UK organiser, Sharon James, claims in tweets to have become a millionaire in seven months, boasting: “I earn as much as footballers.” “I earn as much as footballers,” boasted Sharon James, while Tracey Peake claimed: “I earn while I sleep.” Her co-presenter at recruiting sessions is Tracey Peake, who has claimed online: “I can’t believe how easy this Bitcoin-building business is. I earn while I sleep.”
"Followers in the UK are busy recruiting new investors at nationwide conferences."
"The Mirror went to one of their fortnightly events in Haydock, Merseyside, but it did not pan out as they’d planned, because the hotel cancelled the booking following a spate of negative online reviews." One read: “How can a lovely looking hotel like this allow ponzi schemes like USI-Tech to be punted on its premises?”
"James and Peake resorted to huddling the four or five attendees around a table in the lobby to hear their sales pitch."
Ms James blamed “haters” for the debacle: “Unfortunately they’ve gone on the hotel website, their Facebook, and left really bad reviews. There’s about 17 of them. They’ve even rang the police station, what the police are going to do I don’t know, I’ve got nothing to hide. Don’t believe the haters.”
"They were furious when they realised that [journalists from] the Mirror [were] also in the room and scarpered from the hotel, hidden under head scarves - which is a strange thing to do if they really thought this was a genuine investment opportunity."
"In reality, USI Tech was a classic Ponzi scheme. It offered outrageous rates of return and encouraged investors to boost their earnings by introducing more people to the USI Tech family, with the fees from new investors then used to pay off existing customers."
"[S]ome of the footage was taken from Genesis Mining, a cloud bitcoin mining company that has a facility in Reykjavik, Iceland. Genesis confirmed to Engadget and Point that some of the footage in the video above is from one of its facilities and that it has no affiliation with USI Tech, nor did it give USI Tech permission to use its video."
"[I]t’s essential to research [a] project’s background. In the case of the USI Tech owners, the evidence couldn’t be clearer. Many members were already experienced scam artists well before working for USI Tech. This should have been the only red flag needed for most people."
"It wasn't long before authorities in the United States, Canada and New Zealand caught up with the company and issued cease and desist orders."
"On 20 December 2017, the Texas State Securities Board issued an emergency cease and desist order as neither USI-Tech nor the sales agents, Clifford Thomas and Michael Rivera, were registered to sell securities in Texas."
"Texas Securities Commissioner Travis J. Iles entered an Emergency Cease and Desist Order Dec. 20[, 2017] against USI-Tech Limited, an overseas firm that is promising low-risk, triple-digit returns from investments tied to Bitcoin mining."
"The enforcement staff of the State Securities Board presented evidence to the Securities Commissioner that USI-Tech, based in Dubai, and two U.S.-based sales agents are soliciting investors in dozens of Texas cities through targeted craigslist advertisements, YouTube videos, and standalone websites."
"Neither USI-Tech nor the sales agents, Clifford Thomas of Suitland, Md., and Michael Rivera of Los Angeles, are registered to sell securities in Texas. The investment also is not registered in Texas."
"The company and agents are offering for sale an investment contract in the mining of bitcoin. Mining uses significant amounts of computing power — and electricity consumption — to generate bitcoins for the decentralized online ledger that records and verifies bitcoin transactions."
"The agents’ websites claim the mining investment “derives its value from [USI-Tech’s] non-exclusive interest in a series of Bitcoin mining contracts.” They promise a daily return of 1%."
"The company and the sales agents are telling potential investors the mining contract is a “certified legal product in the USA per the FTC.”"
"The Federal Trade Commission, however, has no role in regulating registration of the mining investment as a security in Texas. The State Securities Board regulates the registration of the mining investment as a security in Texas, the registration of dealers and agents offering and selling the product, and the disclosure of material facts to investors."
"Furthermore, the sales agents are attempting to deceive the public by claiming that USI-Tech has a “binding legal opinion” from a law firm stating the company is “a legal business in good standing.”"
"According to the order, USI-Tech is telling potential investors they can make more money by convincing other individuals to invest in the company’s bitcoin platform. Investors can earn “up to 35% commissions” through its “unique referral marketing plan.”"
"USI-Tech is not informing investors of the danger in being paid commissions from referrals. Individuals paid these commissions must either be registered with the State Securities Board or qualify for an exemption from registration."
"In addition to violating registration requirements, USI-Tech and the sales agents are violating State Securities Board rules by failing to disclose information investors would need to make an informed decision about whether to invest. The disclosure violations include [i]nformation about the facilities used to mine bitcoins, the costs of mining bitcoins, and whether they have successfully mined bitcoins; [t]he terms of the contracts and an explanation of USI-Tech’s “non-exclusive interest” in mining contracts; and [i]nformation about whether the company’s financial condition is strong enough to provide a 1% daily return."
"On 21 December 2017, the Government of New Brunswick issued a consumer alert against investing at USI-Tech, and advised consumers to contact the Commission if approached about investing in the company."
"January 2018: USA and Canada users stop receiving BTC payouts."
"On 12 January 2018, the Attorney General of Guam issued a statement advising people to exercise caution when investing at USI Tech."
"On 26 January 2018, the Government of Saskatchewan issued a Cease Trade Order, and requested anyone contacted by USI-TECH to inform the Financial and Consumer Affairs Authority of Saskatchewan."
"On 9 April 2018, the Spanish financial regulator Comisión Nacional del Mercado de Valores added USI-Tech to its warning list of unauthorised firms and entities."
"On 16 August 2018, the Financial Markets Authority of New Zealand updated its warning list to include USI Tech on basis that it is offering financial services and products to residents of New Zealand without authorization, while also warning that the operators have the characteristics of a scam."
"Just a few months later, an estimated tens of millions of dollars had vanished from investors' accounts." "This scam was/is on an international level and estimated losses from American victims alone is easily over $10 million. Houses were remortgaged, loans taken out, credit cards maxed, bank accounts emptied, and life savings lost."
"In 2019 [the] international Ponzi cryptocurrency scam hit Australia. Scamwatch received over 200 reports about USI Tech with losses of $3.3 million, mostly Bitcoin. USI Tech is now known as one of the biggest cryptocurrency scams in the world."
"[EnGadget] spoke with six victims of USI Tech who have collectively lost thousands. One man, a security guard from Tel Aviv, who didn't want to be named, said he lost more than $147,000 to scammers behind USI Tech and Eyeline. He earns about $8.50 an hour, so a loss of that scale is irretrievable. Being duped also had an impact on his confidence and mental health." "I lost all my life; I can't recover from this," he said, "I don't have any kind of a future." "All told, they lost every cent of the money they handed over to USI Tech."
"We spoke to a woman from northern England who was introduced to USI Tech by her daughter. She asked to remain anonymous for fear of what her friends and family would say if they knew she'd been conned. For the purpose of this article, we've called her Joy and refer to her daughter as Alice."
Joy and her husband initially invested £1,000 (around $1,300). "We monitored it and it seemed to be doing really well," she said. "We then decided to invest [$26,000]."
"They did tell us at the beginning that you were more or less guaranteed to get your money back," said Joy. "I feel so silly now I could cry."
"Alice, who invested and lost a total of £2,000 ($2,600) feels guilty that she introduced her mom to USI Tech to get the advertised referral boost to her investment." "It haunts me," she said. "I can't get my head around it that they could introduce it as a sort of family and friends scheme and then have it just be such a scam."
"Many others wouldn't speak on the record for fear of social stigma. Alice said it's a tough thing to talk about because the referral system naturally means most investors also introduced family and friends who also lost their savings."
"Meanwhile, Rotunda says it's important for law authorities around the world to keep on top of this whack-a-mole Ponzi problem. "The longer these things operate, the more victims they bring in and the more people who are going to be out of money at the end of the day."
"By the time the scheme collapsed in spring 2018, Rotunda estimates the organizers could have extracted hundreds of millions of dollars from the general public all over the world."
"As of March 2019, a domain belonging to USI Tech was redirected to Eyeline Trading, another company claiming to be a cryptocurrency and forex platform trading provider. The redirect suggests that the owners of the original website have relaunched the ponzi scheme through Eyeline Trading, following USI Tech's exposure to law enforcement."
""But that wasn't the end of USI Tech's story. The model soon reappeared with a new name: Eyeline Trading." "Eyeline, just like USI Tech, claims to make profits by both trading and mining Bitcoin. It also offered lofty returns on investments -- as high as 0.66 percent a day, which would turn a $1,000 investment into $11,000 over the course of a year. A USI Tech website, usitech.io, also redirected to Eyeline."
"The former USI Tech website was redirected to Eyeline, but when authorities caught on to the seemingly rehashed scam, Eyeline rebranded to its current form: WealthBoss." "But Eyeline didn't last long after the British Columbia Securities Commission in Canada placed the venture on its Investment Caution List, so it rebranded in January 2019 to WealthBoss."
"Both Eyeline's old website and the newer WealthBoss iteration list R&D Global as the company's true name. While the WealthBoss website has no named contact details, Lee Oakey, Kerry Stockton and Michael Faust are listed as admins for the company's official Facebook group."
Andrew Penman from the Mirror reports he's "heard from people as far afield as Australia, the United States, South Africa, Japan and Malaysia who have lost every penny they put into it. And some of them seem almost as furious with the police for what they see as a lack of action as they are with the scammers themselves."
"A victim from Romford, Essex, described Action Fraud as “not fit for purpose” after it didn’t forward his case to officers for investigation. The poor chap, who invested £2,650, has compiled a group of 60 other UK victims."
“When a member of the public reports a crime such as this to the police and provides perfectly adequate information, including names and contact details and has photographs of the culprits available, then the crime should be thoroughly investigated,” he said.
"A victim from Melton Mowbray, Leics, who lost £3,300, was told that Action Fraud had passed on his complaint to the National Fraud Intelligence Bureau, run by the City of London Police, but they were not taking it further."
“It is suggested you contact the Dubai police authorities to see if they are able to offer further assistance,” it unhelpfully told him.
He hit back: “This is a massive scam that needs looking into from the UK promoters all the way up to the owners who have vanished.”
"A victim from Ayr, Scotland, was so convinced by USI Tech that he invested £40,000 and encouraged relatives to join."
“It is sickening to think that these owners and their main affiliates can just walk away and nothing can be done,” he said.
"[I] am a victim and they should pay i lost $12,000 AUS and I am frustrated as [ever]. These guys are now hiding out spending the millions they took from us. One USI Tech founder is hiding in Brazil somewhere and the others gods knows."
"A spokesman for Action Fraud said that it receives around 25,000 online reports and 40,000 telephone calls each month."
“Those reports that contained sufficient information will have been passed onto local forces for intelligence purposes," he added.
"While not all reports cannot be passed on for investigation, some may be passed on for intelligence purposes, which can help build a picture of how and where fraud and cyber crime is happening."
In the case of USI Tech: “The international nature of fraud poses difficulties in tracing payments and suspects.”
"Harry Page who works on [a] forum [for USI Tech victims], at the time of posting is correct, to quote 'In all honesty, this scam is done and there's no way anyone will be brought to account for it. Too much time has passed now and they are they are long gone'"
"All the victims interviewed by Point and Engadget want to know if they'll ever get justice. Rotunda is cautiously optimistic."
"These schemes can go on for a long time. There are a lot of very creative people out there who are very adept at covering their tracks and concealing their location, but at the end of the day things tend to catch up with them, so I'm confident that whoever is behind it will be brought to justice."
USI Tech had a website which provided investors with the opportunity to participate in an automated arbitrage trading operation that apparently paid a consistent 1% daily return. The opportunity continued to be available for multiple years, and was promoted with different conferences and even lavish beach parties. This proceeded through 2017 and a large chunk of 2018 before eventually being replaced with a login page, followed by disappearing forever. It is believed that investors lost hundreds of millions of dollars, however the exact amount is presently unknown. There is no recovery in sight for any affected users.
HOW COULD THIS HAVE BEEN PREVENTED?
The USI Tech platform operated as a ponzi scheme, whereas a legitimate trading platform would have been able to demonstrate that all customer funds were fully backed on a periodic basis. The lack of any visibility or oversight of the operation meant that there was no way to validate any of the claims of profit being made, and the firm could simply pay new investors with the funds of previous investors in the scheme.
Wayback Machine (Jul 17)
USI Tech - Wikipedia (Nov 21)
Bitcoin Promoter USI-Tech Hit With Emergency Order | Texas State Securities Board (Nov 21)
USI-Tech Back Office Login (Dec 2)
USI-TECH (Dec 2)
Risk Information - USI-TECH (Dec 2)
IMPRESSUM - USI-TECH (Dec 2)
AGBS USI-TECH (Dec 2)
USI Tech Back Office Login (Dec 2)
USI-Tech Support Help For New Site Login Account Setup and Reset - YouTube (Dec 5)
The bitcoin Ponzi scam that won't go away | Engadget (Dec 5)
USI Tech Party in Mallorca With Mike Kiefer (Original Version) - YouTube (Dec 5)
Victims of USI-Tech crypto currency scam furious at lack of action by authorities - Mirror Online (Dec 5)
"I earn money while I sleep" claims promoter of Bitcoin investment spin-off called USI-Tech - Mirror Online (Dec 6)
How USI Tech Pulled off One of the Largest Crypto Scams (Dec 6)
Facebook (Dec 6)
Facebook (Dec 6)
USI-Tech - Moneysmart.gov.au (Dec 6)
Pétition · USI Tech, a Crypto SCAM: recourse for Americans · Change.org (Dec 6)
Every time I try to withdraw money from USI-TECH, it says 'you did not validate your change, so it has not been saved'. I already added security questions and they have been saved. What is the problem? - Quora (Dec 6)
USI-Tech SCAM NOT PAYING OUT !! - YouTube (Dec 6)
[Serious] How come the USI-Tech ponzi scheme still exists? How have they not been shut down or exit-scammed yet? : CryptoCurrency (Dec 6)
