usfia-logoIt’s now looking more certain than ever that we’re going to see an MLM cryptocurrency bust by the end of the year.

The latest in the cryptocurrency MLM niche is the news that the FBI are actively investigating USFIA.

Citing reviewed documents, a September 10th report from LA Times journalist Frank Shyong reveals:

The FBI is now investigating the claims of investors, according to documents reviewed by The Times.

At least one disgruntled investor said he has been interviewed by federal agents, and others have received letters from the bureau alerting them that they might be victims of a securities fraud.

As we’ve seen in multiple MLM securities fraud cases over the past few years, if the FBI have an open case then it’s pretty much a certainty that the SEC are also investigating.

As we saw in both the Zeek Rewards and TelexFree Ponzi bust cases, multi-agency investigations are pretty much the standard these days.

john-wuo-arcadia-city-council-meeting2-july-23-2015One potential casualty of an FBI-led regulatory investigation into USFIA is Arcadia City Councilman, John Wuo (right).

Wuo first popped up on our radar when BehindMLM reviewed USFIA back in June.

Having appeared at multiple USFIA promotional events and personally endorsed USFIA, GemCoin and Founder Steve Chen, Wuo has since claimed he’s not involved and “has no idea what GemCoin is“.

Experts say politicians often face a balancing act when it comes to local businesses. Promoting these businesses is part of every politician’s job, said Robert Stern, former president of the nonpartisan nonprofit Center for Governmental Studies. But it’s important to have the right motives, he added.

“The question is, are [elected officials] doing it for the benefit of the city or the benefit of the company?” Stern said.

A regulatory investigation and subsequent legal action would certainly put questions of Wuo’s apparent ties to USFIA to rest.

For those unfamiliar with the scheme, USFIA push the Zeek Rewards Ponzi points model through their GemCoin cryptocurrency.

GemCoin is pegged to nothing more than the rate of new investment funds deposited by USFIA affiliates.

The basic gist of the Ponzi points ruse is the scheme strings investors along by artificially increasing the value of the points.

This leads to disingenuous marketing pitches, where affiliate investors claim numbers on a screen is actual money they have earnt:

Naturally it is not disclosed that the dollar earnings advertised have not actually been withdrawn by the affiliate advertiser.

Fear of loss also comes into play to dissuade a run on the bank, as investors are lead to believe their points will indefinitely rise in value – so selling out now means later profits will be lost.

With cryptocurrency the latest fad to be attached to the Ponzi points model, naturally this fear of loss marketing evokes comparisons to BitCoin and the brief surge in value back in late 2013.

I for one thing a regulatory crackdown on cryptocurrency MLM opportunities is long overdue, so the news that the FBI are investigating at least one of them is welcome.


Footnote: This article originally contained an image published on an indivudal’s Facebook page.

In those post the indivudal, a OneCoin investor, claimed that his OneCoin points held a value of $67,500.

OneCoin operates a similar cryptocurrency Ponzi points model to USFIA’s GemCoin.

The image was posted to illustrate the point that Ponzi investors routinely misrepresent the actual value of their investments on social media.

In response to this example being published, the individual is seeking to use it to draw publicity to himself. Rather than encourage this psychotic nonsense, I’ve removed the image. The informational content of the article remains intact.

I’m aware of the individual harassing family members of other people and I’d rather not waste time or energy that is better directed elsewhere.