Crypto Startup Accused of Faking Founding Team

| Publish date: 02/28/2019
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The China-based cryptocurrency startup BHB reportedly used a referral-based program to raise at least $20 million. However, it has been revealed that the project apparently was advertising fake information about its founding team.

Illegal Pyramid Scheme

BHB was launched on December 2, 2018. It claimed to offer a solution for peer-to-peer lending using the Ethereum network. However, just over a month later, on January 18, media reports emerged that the startup was operating a pyramid scheme that was actually illegal.

Now, the media uncovered more evidence of things not being right with the company. Further inconsistencies were found in the information that the company had released about its founding team members.

Two images on the company’s website that were supposed to represent BHB founding members are actually of university professors who had no affiliation to the project.

The information on the BHB website bgepay.com stated that one of the team members was a financial engineer called Bobby White. Another was supposedly a Blockchain expert by the name of David Chen and a third called Gregory Moss who was listed as a product designer.

Each of the members’ names was accompanied by images that were supposedly their pictures. However, research showed that Bobby White’s picture was identical to Chinese Tsinghua University’s economics professor, Alexander White. And Gregory Moss’s image was actually a picture of The Chinese University of Hong Kong’s philosophy professor by the same name.

In fact, when contacted, both of them publicly denied any connection to BHB. Professor White stated that any photo of him used for purposes such as these, including attaching his image to the name Bobby White, was fraud.

Professor Moss also stated that he was troubled by this incident and that he had never allowed BHB to use his picture for the purpose of marketing its products. The third image was not verified.

In addition to false images of its founding members on its website, BHB also listed fake contact details such as a disconnected telephone number and a non-existent New York City address.

Prohibition by the Chinese Government

The false information posted on the company’s website was not the only thing that raised a red flag. The mechanism by which the BHB tokens were distributed was also a cause of concern.

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The method used to raise funds had been compared to MLM (multi-level marketing) as well as pyramid schemes. In fact, many people raised doubts about the project, stating that it was just a disguised pyramid scheme – something that is illegal in China.

The challenge is that while some have raised the alarm about what BHB is doing, enough people have made money for the project for it attract fresh investors.

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