Several U.S. states, including California and Texas, have taken action against GS Partners, accusing the company of defrauding cryptocurrency investors through various fraudulent schemes. Regulators claim that GS Partners violated securities laws by making false claims and withholding important details when selling unregistered crypto assets to retail investors.
Unrealistic Promises and Fraudulent Activities
The enforcement action targets multiple entities within GS Partners, such as GSB Gold Standard Bank Ltd., Swiss Valorem Bank Ltd., and GSB Gold Standard Corporation AG. The company allegedly promoted and sold digital tokens connected to a Dubai skyscraper, metaverse real estate, liquidity pools, and other crypto assets, while making unrealistic promises of high returns.
“These were unique opportunities to earn ‘lucrative profits’ and ‘generational wealth’ through blockchain technology and digital assets supposedly backed by gold.”
One aspect of GS Partners focused on promoting digital tokens for the metaverse world Lydian World, while another sold investments in a 36-story Dubai skyscraper known as the “G999 Tower.” The company claimed that these ventures offered exceptional prospects for financial gain.
Authorities have also stated that GS Partners operated a multi-level marketing platform, offering “MetaCertificates.” It is alleged that these interconnected entities are under the control of Josip Dortmund Heit and have engaged in widespread fraudulent activities, posing a threat to public well-being.
Fraudulent Endorsements and Nationwide Allegations
Furthermore, GS Partners is accused of leveraging celebrity endorsements from renowned athletes like boxer Floyd Mayweather Jr. and soccer player Roberto Carlos to attract attention to their deceptive investments.
The emergency actions to shut down GS Partners’ operations were primarily led by California and Texas. However, state authorities in Alabama, Kentucky, New Jersey, Wisconsin, and other states have also raised similar allegations of deceitful practices and misleading claims made to investors regarding the nature and profitability of the crypto assets sold by GS Partners.
Regulators intend to halt these purportedly fraudulent schemes before more retail investors suffer harm. This crackdown serves as a reminder of the ongoing necessity to safeguard consumers from potentially exploitative behavior in the digital asset marketplace.
