With the increasing number of ICOs, which are mostly unregulated, investors have always been urged to be cautious before committing their resources to a project. In a report appearing in CNBC, the people involved in this scam are also linked to other similar thefts. The individuals opened a fake LinkedIn account using fake profiles, and successfully managed to attract over 1000 investors into an ICO venture known as Giza.
What Was Giza About?
The ICO was for a supposed startup known as Giza, which, according to its website, claimed that it was developing a superior safe device that would allow investors to store cryptocurrencies. The ICO was conducted in January and attracted several investors. CNBC reports that one person had invested Ether that was worth $10,000, while another had invested about $5,000 worth of Ether.
At the start of February, Giza had raised and was holding more than 2,100 Ethereum coins, which were valued at $2.4 million at the time, and is now missing.
The Supplier Blows the Whistle
The scammed investors told CNBC that they believed the project was genuine until warning signs started to appear. There was a lack of correspondence from the supposed founders, but it is the fall out with the sole supplier that raised suspicions that the project was a hoax.
An investor named Chris told CNBC by phone:
Everything was fine, until that company that was meant to develop their device came out on the internet and said that Giza has cut ties, and it seems to be a scam and they might not be developing anything. Then things started looking fishy,
Late last year, Giza entered into a contract with a Russian company known as Third Pin LLC, which was to make the devices to be sold. Third Pin says that it is in contract with numerous companies to make hardware for them. However, on January 30th, Ivan Larionov, Third Pin’s CEO announced that his company had cut ties with Giza.
Larionov explained that he was contacted by a Giza representative late last year and given the design of the device that Giza wanted. After his company worked on the details and specifications of the device, a contract worth $1 million was signed with Giza. Larionov went ahead and contacted STMicro, a component supplier, for help in sourcing the parts of Giza’s device. STMicro asked basic questions like the number of devices required and the date of production,, which Larionov couldn’t answer. The CEO relayed the questions to Marco Fike, Giza’s COO who gave answers that Larionov deemed to be unclear, thus raising a red flag.
Fike wanted Larionov to set up a new operations base outside Russia to manage the relationship between Third Pin and Giza, but declined the proposal. After thorough assessment of the production costs, Third Pin found that the costs would be higher than anticipated: $1.5 million. Larionov proposed that Giza pay the amount in installments but Fike was adamant.
At that moment he said no, no way, so next thing I said to my employees is that we will cut the contract.
Vanishing Money and Connection With the Bee Token Scam
Around mid-February, the digital wallet address given by Giza where investors were sending their money, started to show outflows of huge amounts of Ethereum. The trend continued for about two weeks, with the last movement of money from the address being registered on March 2nd. The money was sent to numerous wallet addresses.
Incidentally, there seem to be parallels in the movement of money from Giza case and the Bee token scam. During the Bee token ICO in February, scammers who pretended to be the founders of the project sent emails to people, prompting them to invest in the ICO. Coincidentally, one of the wallets linked to Bee token scam sent Ethereum to Giza, according to etherescan.io, a site that tracks all transactions on the Ethereum blockchain. This is an indication that the person or people behind the Giza scam was also behind the Bee token scam; or they have some sort of relationship.
Who Is the Mysterious Marco Fike?
The apparently well-orchestrated scam centers around a mysterious individual called Marco Fike, the COO of Giza. After the announcement by Third Pin, investors who had been scammed formed a telegram group to unearth the people behind the scam – led by Nicolas, mentioned above. They have now zeroed in on the COO, Marco Fike. People who spoke to CNBC, including developers hired by Fike, have said they have never met him. They all say they had spoken to him through the messaging services.
According to his LinkedIn page, he claims to have studied at the University of Oxford in UK but no specific college is given. Oxford has confirmed to CNBC that the matter is under investigation, and will issue a report soon.
Microsoft Switzerland is listed as a previous employer on LinkedIn but the company told CNBC that he has never been their employee. CNBC also contacted all the phone numbers given on the site; only one was answered and the owner of the number, a man in Dubai, denied any knowledge of a company called Giza.
A member of the telegram group has successfully traced Fike’s LinkedIn profile photo to an Instagram user in Dubai. It remains to be seen whether the Instagram user has any knowledge of this Fike persona, or if his image was used without his knowledge. The user didn’t give any response to the CNBC team after being contacted for a comment.
Meanwhile, Third Pin CEO Larionov was asked whether he had met Fike. He had this to say,
We communicated with Fike over Skype, but he never turned his video on. Instead, we spoke with just audio.
However, he did say that Fike was fluent in Russian, but with an accent.
Additionally, all the would-be employees of Giza have also claimed that they have never met or seen Marco Fike. Almost all of those contacted by CNBC claim that they were hired online and only communicated with him through online messaging platforms.
Image Credit: Deposit Photos
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