USA – Bitcoin Mining Company Ordered to Refund Clients

An Australian company that promised clients 200% return on investment agreed to refund its Texan clients.

Australian company Mining (aka ), that promised its clients returns of up to 200% on in cryptocurrency mining, has agreed to refund its Texan investors of their and admitted to illegally selling unregistered securities.

Mining operates two entities: Mining, which sells cryptocurrency mining based securities as well as operating mining facilities (according to unverified claims made by the company) in various countries including , and ,  and , which provides services for cryptocurrency issued by its parent company Mining.

Texas Securities Commissioner has launched an emergency action against AWS companies in November . The Commissioner’s emergency action determined that AWS was illegally recruiting sales agents via different sites (including and Linkedin).

AWS promised its contracts a 200% return on purchase price. Despite the clear promises made to investors, AWS Mining disclaimed the guarantee, saying that investors are to bear the risks of mining cryptocurrency, under-which the company included “volatility in the price of , system or technical failures, and changes in the cost of electricity used to mine cryptocurrency and cool the hardware used for the mining process”. According to the emergency action taken by the commissioner, AWS used multi-level marketing (often referred to as Pyramid Selling) sales agents network and had devised an elaborate bonuses scheme to incentivize the illegal sales agents working under its lead. Following its findings, Texas Securities Commissioner . Iles, issued an order on August 2, , ordering AWS Mining PTY to pay its Texas clients (19 Texans were named in the order) their back in full, deducting any profits they have made since making the investment with the company.

This is the latest fight in the long battle the Texan authorities are waging against cryptocurrency relates fraud. Earlier this year, the Texas Security Commissioner entered three emergencies cease and desist orders against promoters of cryptocurrency related , who were using , particularly through fraudulent ‘work from home’ forums, to solicit investments from Texan investors.

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