This is a figure so high that it would instantly propel someone into Forbes' list of the 25 biggest billionaires.
Listen to the CoinMarketRecap podcast on Apple Podcasts, Spotify and Google Podcasts
The Securities and Exchange Commission has charged a convicted fraudster and seven others with scamming innocent investors out of $45 million.
It's claimed that Neil Chandran and his co-conspirators promised extravagant returns for backing CoinDeal — and claimed that the venture was generating blockchain technology that would ultimately be sold for trillions of dollars.
The fictitious gains touted to investors were genuinely bonkers. According to the SEC's complaint, victims were told that someone who invested $500 could be in line to receive $12.5 million — a 2,499,900% return.
A sliding scale also suggested that a $1,000 investment would net $25 million, rising to $281.25 million for someone who contributed $5,000.
And it gets even more surreal from here. Victims were told that investing $15,000 would result in a $2 billion windfall for investors… alongside a weird promise of a $25,000 car allowance.
Meanwhile, CoinDeal's promotional materials also suggested that investing $100,000 was going to lead to a 56,249,900% return on investment — and if $56.25 billion wasn't enough, a Bentley GT Convertible would be added on top. This is a figure so high that it would instantly propel someone into Forbes' list of the 25 biggest billionaires.
Current and prospective investors were allegedly lured into a false sense of urgency by being told that CoinDeal was on the brink of being sold in a matter of days — and the SEC says he repeatedly made misleading statements.
The complaint notes how one of those charged declared that in March 2019 that CoinDeal was due to close that day. On May 8, 2019, it was the following day. On October 2, 2019, it was that night. On April 11, 2020, it was expected within three days. And on Jan. 11, 2021, investors were told that the deal would be completed in two days.
It's alleged that Chandran received $37 million of the funds contributed by CoinDeal investors — and ended up spending this money on "a fleet of luxury vehicles, various real estate properties in California and Nevada, and a boat."
Daniel Gregus, the director of the SEC's regional office in Chicago, said:
"We allege the defendants falsely claimed access to valuable blockchain technology and that the imminent sale of the technology would generate investment returns of more than 500,000 times for investors. As alleged in our complaint, in reality this was all just an elaborate scheme where the defendants enriched themselves while defrauding tens of thousands of retail investors."