The collapsed HyperVerse investment scam has truly gone global, leading to recriminations in Australia and arrests in America.
Last week, the Guardian reported that Steven Reece Lewis, the man introduced on video at the HyperVerse global launch event in December 2021 as the CEO of this ‘crypto’ subscription scheme, didn’t appear to exist. The report detailed how Reece Lewis’s purported education and business history appeared to be entirely fictional.
For instance, Reece Lewis was said to hold degrees from both Leeds and Cambridge universities, but neither school could confirm records of anyone by that name attending. Searches of the U.K. corporate registry Companies House and the U.S. Securities and Exchange Commission (SEC) similarly returned zero mentions of Reece Lewis.
Furthermore, his alleged former employer, Goldman Sachs (NASDAQ: GS), denied that anyone by that name had ever worked there. Tech giant Adobe (NASDAQ: ADBE), to which Reece Lewis had allegedly sold a web development firm, had no recollection of ever purchasing any such company.
HyperVerse was a thinly disguised pyramid scheme that allegedly generated revenue via multiple streams, including a ‘crypto’ mining pool (HyperMining), outright ownership of four “digital exchange platforms,” and a claimed three-percent stake in the Binance exchange, plus various’ angel investments’ and market-making activities. HyperVerse’s parent company, HyperTech, declared it would build 300′ education centers’ around the globe to boost knowledge of all things blockchain.
Investors were promised hefty returns—up to 300% over 600 days—along with incentives for recruiting new suckers into the program. A HyperVerse’ membership’ required a minimum $300 investment, with the cash converted to HyperUnit (H.U.) tokens that investors were required to convert to the Tether (USDT) stablecoin in order to withdraw (because all blockchain-based criminality eventually links back to USDT).
HyperVerse investors found it increasingly difficult and ultimately impossible to withdraw their funds before HyperVerse collapsed in mid-2023. By that point, investors had plowed as much as $1.3 billion into the scam, according to Chainalysis reports.
HyperVerse was part of a family of Ponzis organized under the HyperTech umbrella, starting with HyperCash. After HyperCash collapsed, the grift morphed into HyperCapital, then HyperFund, then HyperVerse. HyperVerse’s collapse led to HyperNation, which imploded in May 2023.
While regulators in other nations sounded the alarm over the risks of ‘investing’ with HyperTech brands as early as 2021, Aussie regulators failed to respond despite the company being based Down Under. Following the Guardian’s recent revelations, Australia’s government declared its intentions to press the Australian Securities & Investments Commission (ASIC) as to why it failed to issue a similar warning to local consumers.
One scam leads to another
It will probably come as little surprise that two individuals prominently linked with HyperTech—Xue ‘Sam’ Lee and Zijing ‘Ryan’ Xu—were directors at Blockchain Global, the company behind the failed ACX exchange. The Melbourne-based ACX, which launched in 2016, halted withdrawals in early 2020 after former director Allen Guo claimed his laptop containing the exchange’s digital wallets was stolen at a Chinese airport in December 2019. Blockchain Global itself went into voluntary administration in 2021.
The collapses left customers and creditors out nearly $60 million amid reports that Blockchain Global had improperly commingled customer funds with operating capital. Funds were also reportedly diverted to pay down home loans and invest in a variety of unrelated ventures, including a Canadian cannabis company.
In keeping with the bang-up job that Aussie regulators are doing, it seems the Australian Transaction Reports and Analysis Centre (AUSTRAC) took a full year after ACX investor accounts were frozen to cancel the registration of a company affiliated with Blockchain Global.
Lee didn’t respond to the Guardian’s questions prior to the publishing of its original article. Following its publication, Lee contacted the outlet to claim the article contained unspecified “misstatements” about his HyperVerse role, adding that “people on the internet continues [sic] to make things up.”
Lee was previously involved with a different investment platform called We Are All Satoshi (WAAS) that was slapped with a cease & desist order by California’s Commissioner of Financial Protection and Innovation last September. The order called WAAS “a fraudulent pyramid and Ponzi scheme. It does not sell or purport to sell any actual product and has no apparent source of revenue other than funds received from investors.” There go those people on the internet again…
It’s hard out here for a pimp
Before its demise, HyperVerse boasted endorsements from notable public figures, including Apple (NASDAQ: AAPL) co-founder Steve Wozniak, actor Chuck Norris, and ex-nSync member Lance Bass. The trio isn’t suspected of any involvement in the scam and likely offered their endorsements of both Reece Lewis and HyperVerse after being hired via Cameo, via which celebrities deliver custom video messages for a fee.
Outside of HyperVerse promotional material, CEO Reece Lewis had a threadbare online presence—no LinkedIn account and an X/Twitter account created a mere month before the HyperVerse launch event. That such an allegedly accomplished executive would boast such a thin online paper trail had one sharp-eyed Redditor voicing his suspicions that Reece Lewis “doesn’t exist” two years ago.
On January 4, the X account ‘Nobody Special’ posted a 10-minute video detailing the suspected real-world identity behind the original Reece Lewis appearance. Facial recognition software flagged a U.K. national currently residing in Bangkok named Steve ‘Stevo’ Harrison as the likely Reece Lewis stand-in.
Harrison publicly claims to have worked as a freelance TV host, as well as assisting businesses by “helping front their products & services.” How much Harrison understood about the HyperVerse scam before his involvement with the company remains unknown.
The Reece Lewis subterfuge was recently echoed in the Netflix documentary Bitconned, which recounted the dramatic rise and fall of the Centra blockchain scam. Like HyperVerse, Centra’s founders invented a CEO using a bogus CV. Unlike HyperVerse, Centra simply chose a still image sourced from a Google search for ‘old white guy.’
Rodney on the rocks
Meanwhile, January 5 saw the arrest in Florida of one Rodney Burton, a Miami-based influencer who plies his trade under the name ‘Bitcoin Rodney’ in connection with his high-profile promotion of the HyperTech family of scams.
An arrest warrant was issued in the U.S. District Court for the District of Maryland on January 4, part of a sealed criminal complaint accusing Burton of operating an unlicensed money-transmitting business (MTB) and conspiracy to do the same.
The complaint was filed in Maryland due to Burton registering a shell company in the state to launder his ill-gotten gains. Burton earned a three-percent fee for accepting U.S. dollars from ‘investors’ to fund their HyperFund accounts. The complaint states that the entities he used to process these transactions failed to register as an MTB with the U.S. Treasury Department’s Financial Crimes Enforcement Network (FinCEN).
According to the Internal Revenue Service (IRS) agent affidavit attached to the complaint, Burton instructed other HyperFund promoters to instruct new investors to label wire transfers and checks as ‘Consultation/Training’ to avoid unwanted banking scrutiny.
The IRS agent confirmed that early HyperFund’ members’ were paid out via funds paid in by new members. Also, HyperTech’s alleged “large-scale crypto mining operations” (surprise!) didn’t exist.
Burton collected over $7.85 million from HyperFund investors between June 2020 and January 2022. More than half of the individual payments Burton accepted came after HyperFund began ignoring investors’ withdrawal requests in mid-2021.
This isn’t Burton’s first Ponzi rodeo. BehindMLM linked him to at least two previous scams as far back as 2015. In November 2021, Burton hosted a Reinvent Yourself with Crypto event in Miami, featuring such celebrity guests as singer Akon, Shark Tank star Daymond John, comedian Marlon Wayans, and HyperTech co-founder Ryan Xu.
The pitch for the event describes Burton as “an entrepreneur and cryptocurrency investor that spent 5 years incarcerated. [For what is unclear.] Upon his release in August of 2010, he took on a new mindset that has led to him being one of the most successful investors in the bitcoin industry today.” Burton’s personal website goes further, calling himself “one who has learned from my past mistakes and errors, choices and decisions.” (Doesn’t sound like it.)
Burton’s resealed criminal complaint is scheduled to be unfettered on January 18. If convicted on his current charges, Burton could face at least another five years of pondering his choices before developing yet another ‘new mindset.’
Watch Callahan, MaGruder, Lee, and Reinhardt: Probing criminal acts
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