- As in previous years, the world of investments has continued to see several frauds and scandals come to light in 2023.
- Some of the more peculiar cases involved missing silver coins, untraceable crypto, and bags filled with stones instead of nickel.
- Detailed below are three of the strangest scandals to befuddle the world of finance in recent months.
If you’ve ever bought a stock or a bond, you probably know that most financial investment contracts include a line like, this hidden somewhere in the fine print:
“The value of investments and the income may go down as well as up and investors may not get back the original amount invested.”
Understandable – we should know the risks. What brokers tend not to include, however, is a disclaimer that the asset in question could, at whim, vanish altogether. And unfortunately for some investors, that is exactly what has happened this year.
The year 2023 has seen its fair share of illicit schemes that fraudsters have used to pilfer vast sums of money from the financial system. Detailed below are three of the oddest scandals to have befuddled the financial system in recent times.
The case of the missing silver
Inside a vault where a precious metals dealer was supposed to be storing over half a million of his clients’ silver coins was little more than a bunch of paper IOUs.
For eight years, Robert Leroy Higgins had claimed he was safeguarding over $110 million of rare American Eagle silver coins through his two companies, Argent Asset Group LLC and First State Depository Company LLC – but he was found by courts to have fabricated the entire affair.
The CFTC called it a “fraudulent and deceptive scheme” and Higgins has since been ordered to repay $113 million to customers and $33 million in penalties.
Burglary on the blockchain
When Zhaojun, the CEO of cryptocurrency exchange Multichain, went incommunicado in late May, followed by the disappearance of $126 million of locked token deposits, question marks were raised within the crypto community.
In what insiders think to be one of the bigger ‘rug-pull’ schemes recorded on the blockchain, “abnormal” withdrawals were distributed to six different addresses – draining the platform of its ‘frozen’ funds.
Blockchain analytics firm Chainalyis has sounded the alarm on a possible inside-job by members of staff – linking the disappearance of its founder with the missing coins.
On Friday, Multichain said it’s closing down after finding its CEO had been taken into custody by Chinese police.
As smart as a box of rocks
Back in March, JPMorgan was left red-faced after discovering that the 54 metric tons of heavy metal stored in a Rotterdam warehouse was not the nickel they were promised, but bags of stones. Over $1.3 million of the weighty base metal had vanished and got replaced with rocks.
London Metal Exchange-approved contracts are regarded as the gold standard for metal investors and this mix-up called the security of the prestigious market into question. The owner of the warehouse in the Netherlands, Access World, is expected to foot the bill.
Read more: Over half a million silver coins just vanished – now the metals dealer behind the ‘fraudulent’ scheme must pay $146 million
- As in previous years, the world of investments has continued to see several frauds and scandals come to light in 2023.
- Some of the more peculiar cases involved missing silver coins, untraceable crypto, and bags filled with stones instead of nickel.
- Detailed below are three of the strangest scandals to befuddle the world of finance in recent months.
If you’ve ever bought a stock or a bond, you probably know that most financial investment contracts include a line like, this hidden somewhere in the fine print:
“The value of investments and the income may go down as well as up and investors may not get back the original amount invested.”
Understandable – we should know the risks. What brokers tend not to include, however, is a disclaimer that the asset in question could, at whim, vanish altogether. And unfortunately for some investors, that is exactly what has happened this year.
The year 2023 has seen its fair share of illicit schemes that fraudsters have used to pilfer vast sums of money from the financial system. Detailed below are three of the oddest scandals to have befuddled the financial system in recent times.
The case of the missing silver
Inside a vault where a precious metals dealer was supposed to be storing over half a million of his clients’ silver coins was little more than a bunch of paper IOUs.
For eight years, Robert Leroy Higgins had claimed he was safeguarding over $110 million of rare American Eagle silver coins through his two companies, Argent Asset Group LLC and First State Depository Company LLC – but he was found by courts to have fabricated the entire affair.
The CFTC called it a “fraudulent and deceptive scheme” and Higgins has since been ordered to repay $113 million to customers and $33 million in penalties.
Burglary on the blockchain
When Zhaojun, the CEO of cryptocurrency exchange Multichain, went incommunicado in late May, followed by the disappearance of $126 million of locked token deposits, question marks were raised within the crypto community.
In what insiders think to be one of the bigger ‘rug-pull’ schemes recorded on the blockchain, “abnormal” withdrawals were distributed to six different addresses – draining the platform of its ‘frozen’ funds.
Blockchain analytics firm Chainalyis has sounded the alarm on a possible inside-job by members of staff – linking the disappearance of its founder with the missing coins.
On Friday, Multichain said it’s closing down after finding its CEO had been taken into custody by Chinese police.
As smart as a box of rocks
Back in March, JPMorgan was left red-faced after discovering that the 54 metric tons of heavy metal stored in a Rotterdam warehouse was not the nickel they were promised, but bags of stones. Over $1.3 million of the weighty base metal had vanished and got replaced with rocks.
London Metal Exchange-approved contracts are regarded as the gold standard for metal investors and this mix-up called the security of the prestigious market into question. The owner of the warehouse in the Netherlands, Access World, is expected to foot the bill.
Read more: Over half a million silver coins just vanished – now the metals dealer behind the ‘fraudulent’ scheme must pay $146 million
