Chinese Police Uncover Multi-Million Dollar Crypto Scam HeroChain

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Chinese authorities have reportedly uncovered a 300 million Chinese Yuan (CNY) cryptocurrency-related fraudulent scheme involving the promoters of HeroChain. Police officials in the country have so far identified 21 suspects who they believe may be linked to the crypto crime involving an amount roughly equivalent to $44.5 million.

15 Suspects Arrested So Far

According to reports obtained by 8BTC, more than 15 suspects have been taken into police custody – while at least another six individuals linked to the alleged crypto crime are still at large.

Local police officers in Hengyang, a city in China’s south central Hunan province, have also reported that the suspects launched a gambling-related blockchain platform, called HeroChain. The platform was allegedly used by the accused to lure unsuspecting investors into investing in allegedly fraudulent crypto schemes.

After the promoters of the HeroChain managed to get their HEC token listed on a digital asset exchange, a number of investors reportedly purchased the cryptocurrency. However, the suspects soon took their website offline and disappeared, as attempts to contact them were reportedly unsuccessful.

Attracting Investments Of Nearly 40,000 ETH

Estimates shared by 8BTC revealed that in only two months, the allegedly fraudulent HeroChain blockchain project managed to attract investments of almost 40,000 ether (ETH), an amount valued at over $6 million according to CryptoCompare data.

As detailed in the incident report, hundreds of victims were lured into making investments in the HeroChain project by purchasing the HEC token. Most of the ETH raised was reportedly shared among the promoters of the questionable platform, and so far, only around $3 million of the funds have been confiscated by Chinese law enforcement personnel.

$193 Million Crypto Scam Uncovered

In late January 2019, Chinese police officials in the nation’s Henan province reportedly cracked down on a fraudulent cryptocurrency pyramid scheme. Local scammers allegedly defrauded unsuspecting investors by luring them into investing around 1.3 billion CNY (appr. $193 million) into a questionable project.

There had been 27 arrests made at that time of suspects believed to have carried out the large-scale financial crime. China’s state-owned television broadcaster, CCTV had reported that the “mastermind” of the crypto scam had used the investors’ money to buy a luxurious villa which was reportedly worth “millions” of Chinese Yuan. The villa had been used to store huge sums of cash totaling nearly $200 million.

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