TechFlow News, May 3: According to a Cointelegraph report, New York Attorney General Letitia James announced that over $5 million in restitution has been recovered from the cryptocurrency platform Uphold for misleading consumers and promoting fraudulent investment schemes. Between January 2019 and October 2020, Uphold promoted CredEarn on its platform and mobile application, touting it as a safe, reliable savings product offering an attractive annual percentage yield (APY). However, Uphold failed to disclose the actual risks involved, and at the time, no insurance existed in the industry to protect retail investors against losses from digital assets. In addition to making misleading claims, Uphold also failed to register as a broker or commodity trading advisor, as required by law. Starting in March 2020, Cred incurred massive losses due to high-risk loans and filed for bankruptcy in November of the same year—resulting in financial losses for thousands of Uphold users worldwide. Under the settlement terms, Uphold will directly pay $5 million to affected users—more than five times the fees it collected. Any funds Uphold recovers from the Cred bankruptcy proceedings will also be transferred to the affected users.
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