TechFlow news, according to Hunan Finance, a major virtual currency-related fundraising fraud case has been concluded by the Zhengzhou Intermediate People's Court. In March 2018, Zhou, Tong, Wu, and others commissioned Chengdu Xingyi Network Technology Co., Ltd. to design the GBC platform software and create false promotional materials, falsely claiming that GBC Coin and Wealth Coin were blockchain-based virtual currencies with significant appreciation potential.
The fraud gang developed downlines through WeChat groups and social media, and held a national promotion conference in Tongxiang, Zhejiang in June 2018, falsely claiming that the GBC company headquarters was located in the UK and was an investment project introduced by Shenzhen municipal government. After the platform’s capital chain broke, Zhou further lied about being hacked, luring members into continuing investments, then instructed the tech company to take the software offline and delete all data.
The court found that GBC Coin and Wealth Coin were merely digital symbols generated out of thin air by the system, possessing no economic value whatsoever. The platform operated as a pyramid scheme, using funds from later investors to pay withdrawals for earlier investors, without any actual business operations. By the time the case was uncovered, the GBC platform had expanded to 47 membership tiers, involving 59,548 member accounts, with a total transaction volume of 3.408 billion yuan. Among these, 40,480 members suffered losses amounting to 629 million yuan, while the main perpetrators profited over 226 million yuan through the platform.
The court ruled that the four principal offenders—Zhou, Tong, Wu, and Liu—were guilty of fundraising fraud and were sentenced to fixed-term imprisonment ranging from 13 to 15 years.
