A well-known online stock market commentator was accused of swindling investors after he allegedly failed to deliver on his promise of a decent return in a cryptocurrency mining deal.
Accompanied by members from the Democratic Party, the investors said in a press conference on Sunday that they lost a combined HK$3.2 million in the investment scheme hatched by Raymond Yuen, the Hong Kong Economic Journal reports.
The party said the investors alleged that Yuen, who makes online commentaries on stock market trends under a pseudonym, lured them into investing in a company specializing in cryptocurrency cloud mining services by giving false statements, ignoring risks and failing to disclose related interests.
It said it went through the investment contract and found that “the devil is in the detail”.
Ramon Yuen Hoi-man, deputy spokesman for the party’s financial policy panel and a member of Sham Shui Po District Council, said Raymond Yuen told the investors sometime in May this year that they could get their money back in only nine to 10 months and start making profits afterwards.
After a few months, however, the investors thought that their chances of recouping their investment were diminishing as the money given back to most of them was getting less and less each month.
One of the alleged victims said she had borrowed HK$200,000 and, together with her own HK$100,000, invested it in the company. However, her investment is now almost totally gone and she has to work several part-time jobs to pay back the loan.
Ramon Yuen, who is a chartered financial analyst, said Raymond Yuen had vowed in a social media post that people investing in cryptocurrency mining can change not only their own life but also the lives of the next three generations of their families.
However, he had failed to tell investors in detail about the associated risks of cloud mining and whether he had any interests associated with the company.
Shum Wan-wa, a member of the Wong Tai Sin District Council who is a lawyer by profession, said the contract signed by the investors was a trap because by signing it they waived their right to launch a class action suit against the company and they could only file a complaint with an arbitral institution in the United Kingdom.
Such terms are clearly meant to make it difficult for investors to seek compensation for investment losses due to fraud, Shum said.
Raymond Yuen on Sunday afternoon posted a post that apparently was in response to the investors’ accusations, but the post was removed 20 minutes later.
He did not immediately respond to newspaper requests for comments about the allegations.
In another development, a 35-year-old man and a 56-year-old woman filed a report with the Wan Chai Police Station, saying they got swindled after investing HK$100,000 and HK$630,000, respectively, in a company that promised to generate high returns through cryptocurrency investment tools.
No arrests have been made so far, police said.
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