- Lyfecoin scam costs $3 million
- Police dismiss case, cite insufficient evidence
UK police have stirred controversy today after ruling that no crime was committed in an alleged case of fraud. Investors estimate that the scam has cost them approximately three million dollars.
Last Tuesday, the British newspaper Metro published an expose about a cryptocurrency start-up called Lyfecoin. In the story, would-be investors reveal that they were promised hefty returns in exchange for substantial investments into Lyfecoin but have not seen a single penny in return. Investors claim that they were guaranteed to receive 100% returns after a five-month staking period. At the end of those five months, they were told that they would need to extend to a 12 or even 24-month staking period. To add insult to injury, they didn’t receive so much as a fraction of their promised return.
UK Investors allege that one Sakhi Rezaie deceived them. Investors feel that Mister Rezaie tricked investors into funding a pyramid scheme. They also claim that payments were sent to Rezaie’s bank account rather than a business account. Mister Rezaie, when questioned by Metro, claimed that he was just another Lyfecoin investor. However, screenshots of a WhatsApp chat produced by one of the scheme’s alleged victims cast doubt on Rezaie’s narrative. Rezaie also ignored or refused attempts by investors to sell their stakes, adding further credence to their claims. The evidence also suggests that Rezaie did not act alone in the execution of this supposed Pyramid Scheme.
Investors raised the alarm after discovering that most cryptocurrency exchanges didn’t trade Lyfecoin. This effectively meant that the cryptocurrency had a value well below the $1.60 promised by Rezaie and his associates.
Investors reported Rezaie’s activities to UK organization Action Fraud, who forwarded the reports to West Midlands police after investigating their claims. Rezaie contacted investors shortly after this, signing a contract promising to pay back the invested money at the rate of $6,470 a month. Investors claim to have only received one payment.
UK Police have since dropped the case. They claim that investors’ evidence offers “No way forward” and that “No offense has been committed.” The alleged fraud has echoes of the OneCoin scam from 2019.