Jeremie Sowerby sued for My BlockX securities fraud in AZ
The Arizona Corporation Commission is looking to file a securities fraud cease and desist against We Sell Miners LLC and owner Jeremie Sowerby.
The ACC’s Securities Division claims We Sell Miners LLC and Sowerby have violated Arizona’s Securities Act.
As alleged by the ACC’s Securities Division, We Sell Miners LLC and Sowerby (right)
marketed investments in two new cryptocurrency miners, and their respective cryptocurrency tokens, Kannabiz Koin and BlockX.
While I’m not familiar with Kannabiz Koin, BlockX is part of Sowerby’s My Blockchain Life and My BlockX Ponzi schemes.
The sales pitch was simple, invest in their cryptocurrency mining machines, receive new coins as rewards, and exchange these coins for a large profit.
As it turned out, Respondents overpromised and never delivered, and investors have yet to receive a return on their investment.
Kannabiz Koin’s and My BlockX’s business models were relatively the same.
Kannabiz Koin affiliates invested $7000 in KK Miners, on the promise of passive returns paid out over 1000 days. Returns were paid out on K Koins, a cryptocurrency token Sowerby created.
Sowerby told investors that K Koinz are a tradable cryptocurrency, backed by an established cannabis company in Oklahoma.
Kannabiz Koin’s K Koin returns were supposed to pay out a “guaranteed no-risk” $7000 a month per investment.
Kannabiz Koins pre-launched in November 2021. On December 24th, 2021, Sowerby listed K Koinz on his My BlockX exchange.
This was done so Sowerby could drain “the equivalent of $600,000 in cryptocurrency … from the K Koinz project liquidity pool”.
After the failed December launch, Respondents reassured investors that K Koinz would launch on April 20, 2022.
Additionally, Respondents informed investors that K Koinz had secured celebrity endorsements from Snoop Dogg and Justin Bieber.
K Koinz failed to launch on April 20, 2022.
Despite the second failure to launch, Respondents reassured investors that the K Koinz launch was imminent, this time on June 1, 2022.
Prior to the supposed June 1st launch, Sowerby hosted a Zoom video meeting for KK Miner investors.
Sowerby used the Zoom to pitch his Kannabiz Koin bagholders on My BlockX.
Sowerby spoke at length about his other cryptocurrency mining venture … and how the BlockX token (“BLKX”) value would
soon reach upwards of $10 per BLKX token.Sowerby went on to encourage KK Miner investors to directly purchase additional K Koinz in anticipation of a skyrocketing price increase after the June 2022, launch.
This time K Koinz did launch on My BlockX. By this stage of course Sowerby had no intention of honoring any cash out requests.
The value of K Koinz was significantly lower than the previously-guaranteed $0.018.
As a result, investors were unable to sell any of the K Koinz mined for them via the KK Miners.
What followed was an attempt to offload Kannabiz Koin’s ROI liabilities onto the aforementioned “established cannabis company in Oklahoma”.
On June 15, 2022, Sowerby hosted another Zoom video meeting for KK Miner investors.
During this meeting, Sowerby told investors that K Koinz would actually be used as loyalty- or reward-type tokens, to be used exclusively on products at the OK Cannabis Company.
Sowerby went on to tell investors that the OK Cannabis Company, not Respondents, was responsible for the liquidity of K Koinz, and We Sell Miners’s sole purpose was to host the KK Miners.
The ACC’s Securities Division believes this was an exit-scam planned from the beginning.
After the June 15th Zoom webinar, things continued to deteriorate.
During the July 28th Zoom meeting, a representative of We Sell Miners, LLC told investors the endorsements from Snoop Dogg and Justin Bieber had fallen through.
Upon information and belief such endorsements, including the negotiation of such endorsements, never existed.
Sowerby deflected refund requests from Kannabiz Koin investors onto We Sell Miners LLC’s COO. These investors were told their refunds would be processed, but they wouldn’t be able to cash out for a year.
Other Kannabiz Koin investors were told if they wanted a refund, they had to switch over to My BlockX.
Upon information and belief, no investor has received a return on their investment in KK Miners through the sale of K Koinz, nor has any investor received a refund for their investment in KK Miners.
My BlockX launched in November 2021 and had affiliates invest in BLKX Miners. This went on until mid 2022, after which My BlockX pivoted to “staking” and a trading bot Ponzi models.
Like K Koinz, investors could invest in a BLKX Miner for $6,000 and in return they would mine 100,000 BLKX per month.
Similarly to K Koinz, Respondents told investors that the miners were physically located and hosted at his mining facility in Tempe.
Upon information and belief, no investor ever received a physical mining machine from Respondents.
My BlockX returns were paid in BLKX, another cryptocurrency token Sowerby created.
Sowerby represented that BLKX was already trading on the MyBlockX website, at a starting value of $0.004 per token and that the value of the token would quickly rise as high as $10 per token.
Sowerby based the $10/token representation on the introduction of a new staking model that required investors to buy and hold BLKX tokens.
Sowerby, during Zoom investor meetings, encouraged investors to buy more tokens and stake them, claiming that once all the tokens were staked, the price would skyrocket, and everyone would make a lot of money.
Here’s how My BlockX ultimately panned out;
Upon information and belief, BLKX is not accepted currency anywhere outside of the MyBlockX exchange, which is owned by Respondent Sowerby.
At the time of filing, BLKX has no monetary value.
Upon information and belief, no investor has received a return on their investment in BLKX Miners through the sale of BLKX, nor has any investor received a refund for their investment in BLKX Miners.
The ACC’s Securities Division claims to have tracked “over $57 million in cryptocurrency” to one wallet owned by Sowerby.
Total Kannabiz Koin and My BlockX investor losses are unknown.
In filing their notice, the ACC’s Securities Division seeks a cease and desist be entered against We Sell Miners and Sowerby, restitution and civil monetary penalties.
The ACC’s Securities Division’s original notice was filed on December 2nd, 2022.
We Sell Miners LLC and Sowerby filed a notice requesting a hearing and jury trial on the matter on December 28th, 2022.
On February 24th We Sell Miners LLC and Sowerby filed a Motion to Dismiss the case.
The basis of this motion is simple: Respondents do not and have not offered or sold securities of any kind.
Rather, they sell hardware for mining cryptocurrency and provide hosting services to their customers at a colocation facility in Tempe, Arizona.
The ACC’s Securities Division filed its response to Sowerby’s Motion to Dismiss on March 24th.
Having documented Sowerby’s My BlockX securities fraud, I don’t see Sowerby’s “our securities offering isn’t a securities offering” argument holding up in court.
A hearing on the Motion to Dismiss has been scheduled for June 15th, 2023.
Although only We Sell Miners LLC and Jeremie Sowerby are the only named respondents in the ACC’s Securities Division’s notice, of note is Arizona resident Douglas Carpa also being served.
Carpa appears to represent We Sell Miners LLC (possibly as the unnamed COO), which would make him an accomplice to Sowerby’s alleged securities fraud.
Back in 1996 Carpa, then aged 50, now 78, was sentenced to four years in prison for tax evasion.
In 1998 Carpa was sentenced to an additional ten years for conspiracy and obstruction of justice.
Two tax resisters plotted to disrupt their federal tax evasion trial in San Francisco by using armed militia members to “arrest” the judge, the prosecutor and the U.S. attorney.
The resisters … provided the activists with a list of the names and badge numbers of the jurors selected for their federal tax fraud trial, the indictment says.
Philip Marsh and Douglas Carpa now face prosecution for conspiracy and obstruction of justice stemming from their alleged involvement in the effort to disrupt their tax evasion trial.
Bureau of Prisons records show Carpa was released in 2005.
I can’t 100% confirm his involvement but I believe Sowerby’s cryptocurrency fraud dates back to BitClub Network.
BitClub Network was a crypto mining MLM company launched in 2014.
The scam’s owners were arrested in 2019, with the DOJ confirming BitClub Network was a $722 million dollar Ponzi scheme.
BehindMLM has been tracking Sowerby’s confirmed securities fraud since 2019, beginning with Dunamis Network.
Dunamis Mining was an MLM crypto “mining” themed Ponzi launched in early 2019.
A few months after launch, Sowerby put BitClub Network scammer Joe Abel in charge and rebranded as Dunamis Global Tech.
Dunamis Global Tech collapsed by the end of 2019. Sowerby sold the affiliate investor base off to Travis Bott’s Onyx Lifestyle Ponzi.
After Dunamis Global Tech came Kannabiz Koin and My Blockchain Life, the latter of which would eventually become My BlockX.
Whether there is a federal investigation into Sowerby’s cryptocurrency Ponzi schemes is unclear.
Following the Motion to Dismiss hearing, our next update on the ACC Securities’ Division’s case is expected to be on or around June 15th.
Update 25th June 2023 – The Motion to Dismiss hearing has been rescheduled for July 13th, 2023.
Update 8th September 2023 – Not really sure what’s going on with Sowerby’s case. A transcript of the July 13th hearing is on the docket but I can’t view it.
Other than that there are no substantial updates.
Update 30th September 2023 – Jeremy Sowerby has been arrested on wire fraud charges dating back to 2017.
In my experience in crypto currency, lots of protocols, platforms, etc ask you to buy a mining contract… where I’ve never seen actual “mining” (i.e. PROOF OF WORK) being done, but rather, it is similar to staking where coins are emitted.
Emitted coins usually means there is “inflation” in the project. The problem happens when the project emits far too many coins (and they usually do this to hype of a high return to get investors in)… and this high return far out performs the extreme sell demand when nearly everyone wants to cash out and get something of actual value.
Having a 107% return on a value less coin, is still nothing in real life. Sell pressure on various crypto projects is ALWAYS high.
The key in crypto programs is to create BUY PRESSURE to keep the price high, and that is rarely ever considered in a significant number of projects (MLM or not) out there… best to find deflationary projects that have reasonable returns.
You sleep better at night and get REKD far less often.
About 6 months ago, a friend asked me to watch a zoom call about BlockX and their mining.
I can’t remember who the presenter was, but I was told it was the “top guy”, so it probably was Jeremie. But I’ll say again, that I didn’t note the name.
I was given an opportunity to ask any questions, and I can’t remember if I did or not.
If I did, I’m sure I was quite unhappy with whatever the presenter said. But vaguely, what I do remember, is that the guy sound like he literally had zero clue what he was talking about.
I’m not saying I’m the biggest crypto expert that exists… but whomever was giving the presentation I watched was slightly above a newbie and was saying tons of things that just were not correct in any universe, especially crypto.
So I told my friend, who told me he had invested $10,000 in the project. I wonder how that worked out for him?
They’re Ponzi schemes chief. Math always catches up in the end.
Oz. I am trying to provide “generic” education here that benefits the entire crypto community.
There is a significant difference between “inflation” and “ponzi”, and sometimes you have both working in the same project.
Is that cool with you “chief” or are we arguing?
Ponzi math > inflation. Inflation is a red herring when it comes to discussing the math of Ponzi schemes.
Outside of that point couldn’t care less.
Glad this guy is finally going down honestly..
Honestly, and I’ve said this in another posting. Jeremie was not alone in any of this. He had people like Carol Storms and Craig Casey spreading their crap around the universe.
Not to mention, Matthew (Walter White) who “designed” their trading algorithm that was complete bogus and this guy had zero knowledge of trading before. Just another fall guy who definitely knew the garbage that was being peddled
Jeremie was also involved with a guy named Joe Abel.
I was invited to the mining facility in AZ once and I will tell you after I heard about the “Dunamis theft of machines” and I saw the facility it was obviously those Dunamis machines were right there in that new facility .. being remade and repackaged for resale
If you ever went to that facility you would know.
Now the KK Coin was a total crap shoot too. A guy who went by the name “Pollywood” promoted that and acted like he was “on set of a Netflix special” during calls and would just parade around like he was “somebody” it was just a marketing tactic.
The whole Justing Beiber and Snoop Dogg affiliation is bogus too.. I forget who it was but someone in the Discord published that and proved that neither one of them had even heard of KK Coin.
Just all BS.
But I would say that Jeremie NEVER acted alone and he always had a team of people just as bad as him.
Article updated noting Motion to Dismiss hearing has been rescheduled.
As someone who invested in blockx is there any chance there is a process or class action suit by which myself and other investors could hopefully recuperate even some of our funds?
Sure, go and see a lawyer.
Although not sure there’d be much point now that Sowerby has been arrested.
Having come across this article, it is good to know that Jeremy is hopefully going to pay for his wrongdoing.
I and a couple of other investors in the UK I know were sold into investing with Jeremy by Craig Casey. We actually were flown out to meet Jeremy in Phoenix.
Having initially been “coaxed” into investing in BlockX, Jeremy via Craig, suggested we invest in another scheme called Justice Capital where our investments from BlockX would be transferred to and we would receive astonishing returns.
Of course it was all a scam. We all lost a lot of money. Once bitten, twice shy.