Feds raid cryptocurrency startup accused of scamming $32M from investors

Gemcoin Asia released this video of their visit to Gemcoin headquarters in Arcadia, California, in February 2015. (credit: Gemcoin Asia)

The Securities and Exchange Commission announced Thursday that it sued a Southern California company over an alleged Ponzi scheme resulting in a loss to investors of at least $32 million. If the government’s accusations are correct, that would make Gemcoin one of the largest digital currency-based financial schemes ever.

Thousands of people in the United States and abroad are believed to have put money into the company, converting their cash into “Gemcoin,” a Bitcoin-like cryptocurrency.

Numerous online promotional videos in many languages claim that Gemcoin’s parent company, Alliance Finance Group (AFG) and its subsidiary United States Fine Investment Arts (USFIA), controlled $50 billion in amber mine assets in Latin America.

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