The U.K. High Court has appointed liquidators to administer the affairs of the GPay digital currency trading platform, following allegations the company is “nothing but a scam.”
The exchange, which also operates under Cryptopoint and XtraderFX, solicited investment online through a range of ads on social media platforms.
However, according to the Insolvency Service, the ads falsely claim the endorsement of high profile business people and television personalities.
Following a series of complaints to local authorities, the agency opened an investigation into the firm, concluding that it had been operating on a fraudulent basis.
In a strong assessment of the alleged scam, UK Insolvency Service chief investigator David Hill said GPay had been tricking clients to solicit investment under false pretenses.
“GPay persuaded customers to part with substantial sums of money to invest in cryptocurrency trading. This was nothing but a scam as GPay tricked their clients to use their online platform under false pretences and no customer has benefited as their investments have been lost.”
Among the allegations presented to the court was evidence of withdrawal requests being denied for non-active traders. According to the findings of the investigation, at least 108 clients had been found to lose £1.5 million through the platform—equivalent to approximately $1.8 million.
The case was brought to a close on June 23, 2020 with the appointment of liquidators following a petition by the Secretary of State for Business, Energy and Industrial Strategy.
The case follows steps from enforcement agencies in the U.K. over recent months towards cleaning up the digital currency sector.
Most recently, the Advertising Standards Agency unveiled a new system for identifying and removing fraudulent digital currency ads online, while financial regulator the FCA pledged to tackle fraud after identifying losses of $34 million from unsuspecting traders.
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