UK shuts crypto firm over fraudulent Ponzi scheme

Key Coin Assets Ltd, a UK-based crypto investment company that guaranteed returns of up to 100%, has been shut down by the High Court in London following an investigation by the Insolvency Service. The company is accused of operating a fraudulent Ponzi-style scheme, leaving nine investors out of pocket by more than £300,000.

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Key Coin Assets Ltd promised guaranteed returns but delivered nothing. Their behaviour displayed all the hallmarks of a Ponzi-style scheme.

Investigations revealed a complete lack of evidence of genuine trading activities. Instead, funds deposited by new investors appeared to be used to pay off earlier investors, a hallmark of a Ponzi scheme. Mark George, Chief Investigator at the Insolvency Service, stated, "Key Coin Assets Ltd promised guaranteed returns but delivered nothing. Their behaviour displayed all the hallmarks of a Ponzi-style scheme."

George further explained that investor funds were often transferred directly into the company director's personal account, frequently within hours of receipt, making them difficult to trace. The company also allegedly posted fake testimonials online and instructed investors to use vague payment descriptions to avoid scrutiny.

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Investors were told their money was being invested in crypto, but our investigation found no evidence of any genuine trading at all. Instead, funds were simply moved into the director’s personal account, often within hours of arriving.

Investigators found that Key Coin Assets Ltd failed to provide accounting records when requested and repeatedly changed its registered address. Despite Companies House filings suggesting assets worth up to £42 million, banking activity indicated otherwise. The Official Receiver has been appointed as the liquidator. The Insolvency Service and the Financial Conduct Authority are urging potential crypto investors to exercise caution and verify firm registrations.

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We would urge anyone considering a similar offer to check whether a firm is registered before handing over their money, and to be deeply sceptical of anyone promising guaranteed returns with no risk.