GS Partners Accused of Defrauding Crypto Investors in Metaverse Schemes

Author

Trent Alan

Author

Trent Alan

About Author

Trent has a background and education in journalism and communications, with two decades of experience editing and writing on a diverse array of topics. In recent years, however, he has shifted his...

Author Profile

Share

Copied

Last updated:

November 16, 2023 19:46 EST

Why Trust Cryptonews

Cryptonews has covered the cryptocurrency industry topics since 2017, aiming to provide informative insights to our readers. Our journalists and analysts have extensive experience in market analysis and blockchain technologies. We strive to maintain high editorial standards, focusing on factual accuracy and balanced reporting across all areas - from cryptocurrencies and blockchain projects to industry events, products, and technological developments. Our ongoing presence in the industry reflects our commitment to delivering relevant information in the evolving world of digital assets. Read more about Cryptonews

Ad Disclosure

We believe in full transparency with our readers. Some of our content includes affiliate links, and we may earn a commission through these partnerships. Read more

California, Texas, and several other U.S. states have cracked down on GS Partners, accusing the company of defrauding cryptocurrency investors through various fraudulent schemes. Regulators say GS Partners violated securities laws by making false claims and omitting key details when selling unregistered crypto assets to retail investors.

Celebs and Skyscrapers in Alleged Crypto Fraud

The enforcement action focuses on several GS Partners entities including GSB Gold Standard Bank Ltd., Swiss Valorem Bank Ltd., and GSB Gold Standard Corporation AG.

GS Partners is alleged to have promoted and sold digital tokens linked to a Dubai skyscraper, metaverse real estate, liquidity pools, and other crypto assets while making unrealistic promises of high returns. Regulators said one part of the business promoted digital tokens for the metaverse world Lydian World, while another sold investments in a 36-story Dubai skyscraper dubbed “G999 Tower.” The company claimed these were unique opportunities to earn “lucrative profits” and “generational wealth” through blockchain technology and digital assets supposedly backed by gold.

Additionally, GS Partners ran a multi-level marketing platform offering “MetaCertificates,” authorities stated. The agencies allege these interlinked entities are controlled by Josip Dortmund Heit and have broadly carried out crypto investment fraud, posing immediate public harm.

Metaverse Schemes Flagged as Bogus Offerings

However, state agencies say these offerings were completely fraudulent with no real underlying value. Additionally, GS Partners is accused of using celebrity endorsements from high-profile athletes such as boxer Floyd Mayweather Jr. and soccer player Roberto Carlos to draw attention to the bogus investments.

The emergency actions ordering GS Partners to cease operations were led by California and Texas. But authorities in Alabama, Kentucky, New Jersey, Wisconsin, and other states have all raised similar allegations of deceitful practices and misleading claims made to investors about the nature and profitability of the crypto assets sold by GS Partners.

Regulators say they want to shut down these allegedly fraudulent schemes before more retail investors are harmed. Crypto industry watchers note this latest crackdown highlights the continued need to protect consumers from potentially predatory behaviors in the digital asset marketplace.