Cryptocurrency broker ZC Exchange appears to be engaged in fraud against California consumers
The California Department of Financial Protection and Innovation (DFPI) has received a complaint from at least one California resident regarding a crypto investment.
The victim met “Nisa Gacias (aka Champion)” online who introduced him to investing in cryptocurrency. He started by transferring $25,000 to the crypto trading platform ZC Exchange, then added $100,000 more. Everything seemed to be fine during this time as he believed his investment was growing in value, he continued to put in more money. At some point, the victim believed his account held $1.2 million Tether, and he decided to withdraw some money. He was then told before he could withdraw, he needed to pay taxes of $187,000.00 to the trading platform. When the victim asked for an extension to pay, he was told there would be an additional charge of $8,000. The victim refinanced his house and paid the taxes and fee, thinking he would get his money from the investment back. But the company only demanded more money to liberate his funds, so he had to borrow more money from relatives. Despite paying the money, the company still didn’t allow him to withdraw funds and kept demanding more funds. So far, the victim has paid more than $400,000 on top of the money he invested. He is only able to communicate online with ZC Exchange’s customer service and cannot get ahold of a live person. Meanwhile, Nisa encouraged him to pay the company so he can get his funds back. The company operated the websites at https://zcorg01.com and https://FTXbuy66.com.
This appears to be what is commonly called an “Advance Fee scheme,” which can take many forms, as discussed here: https://www.fbi.gov/scams-and-safety/common-scams-and-crimes/advance-fee-schemes. This also appears to be what’s known as a Romance Scam, which is described here: https://dfpi.ca.gov/2022/05/20/romance-scams-and-crypto-assets-fact-or-fraud/
The DFPI urges consumers to exercise extreme caution before responding to any solicitation offering investment or financial services. To check whether an investment or financial service provider is licensed in California, consumers may contact the Department for questions or inquiries at email@example.com or call toll-free at (866) 275-2677. If a consumer believes a person or company has violated state law or acted improperly regarding a consumer financial product or service, they may file a formal complaint with the DFPI at https://dfpi.ca.gov/file-a-complaint/.
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