The Polish competition authority UOKiK has warned the public about the alleged fraud DasCoin. The authority also instructs the operator of the token to stop its “illegal activities”.
The token was uncovered as fraud last May, after the Polish public prosecutor’s office launched an investigation into the DasCoin inventors.
The regulator said in an official statement that it believes that CL Singapore, the DasCoin operator, “has violated consumer interests”.
The UOKiK stated: “CL Singapore has established, operated and promoted a network of independent agents called NetLeaders and rewards them with a NetLeaders Remuneration Plan.”
Instead of rewarding token holders for sales, participants were offered benefits for introducing new customers – in classic Ponzi style.
The UOKiK says it has instructed the company to “stop” such activities.
In Poland’s potentially largest currency-based Ponzi scheme, the alleged scammers appear to have defrauded investors of an estimated USD 66 million, according to data published in the newspaper Dziennik Gazeta Prawna.
Before the public prosecutor’s office took action in June 2018, the operators were able to sell about 100,000 “licenses” at prices ranging from USD 111.6 to USD 27,900, the office said.
Payments were accepted in euros, Bitcoin and gift codes.
The investigation by the public prosecutor’s office is still ongoing, and approximately USD 11.6 million in assets were seized from a bank account linked to a DasCoin operator.
In October 2018, the Trading Jam Foundation, headquartered in Warsaw, published a letter from the District Prosecutor’s Office of the Polish capital stating that the prosecution is investigating the creators of the crypto-currency for suspected criminal violations.
Polish law provides that in cases of fraud and deception, offenders can be punished with prison sentences ranging from six months to eight years.