How the Crypto King Scammed the Masses

This saga began several years ago when the Crypto King launched his firm AP Private Equity. The firm advertised that it could help crypto investors put their funds to use and guaranteed a certain amount of returns. 

"It's alleged that Pleterski solicited funds from investors promising massive profits and also guaranteeing no loss for the original money put out by investors," Chief Peter Moreira said in a recent statement. 

Of course, this was all a lie and there were no investments being made. According to some reports, he invested less than 2% of the $30 million he raised from investors in any crypto. Instead, the rest went to fund his lavish lifestyle which included luxury cars, private jet trips, and high-end property. 

As he was spending investor funds on himself, he also showed off his acquisitions on social media. While this definitely raised his profile, it also led to suspicions from his victims. He had made all these lofty promises but wasn’t giving out any returns or giving people their money back. 

Growing ever desperate, some of his victims decided to take laws into their own hands, and in 2022, Pleterski was kidnapped in downtown Toronto. His captors forced him into a car and held him captive for three days. During this time, he was beaten and his assaults were recorded, with his captors threatening his family and forcing him to apologize for his actions. 

When he was released, police launched an investigation into the kidnapping and arrested five suspects in connection to it. One of them had lost almost $750,000 by investing with Pleterski and all are being charged with kidnapping, forcible confinement, aggravated assault, and conspiracy.  He also filed for bankruptcy and has been going back and forth with the courts about his finances. 

It was around the same time that law enforcement began an 18-month investigation into Pleterski’s affairs. Dubbed ‘Project Swan’, investigators sorted through thousands of financial documents and interviewed people close to the situation trying to build a case.

Eventually, the sheer scale of Pleterski’s fraud came to light and police moved to make arrests. One of Pleterski’s associates Colin Murphy was arrested for fraud. A potential investor had given him $120,000 to invest with Pleterski and was defrauded. On May 14, 2024, Pleterski was arrested and charged with fraud and money laundering.

He was released on the same day that he was arrested, with his parents putting up $100,000 surety for his bail. Police have urged any victims of Pleterski’s to come forward as the final tally is not yet known.

Pleterski, on his part, has taken to social media since he was released on bail. He posted several TikToks and said on Instagram, "So many of you guys are supportive, y'all are amazing."

While he is keeping his head up, the trustee in charge of his bankruptcy case is fighting to block his discharge request. The trustee in question is accounting firm Grant Thornton and it says that Pleterski needs to pay back $4.5 million in customer funds. On top of this, many of his recent purchases have not been accounted for.

This includes a $360,000 watch, $500,000 spent on video games, and $2.7 million in crypto. 

"Given Pleterski's history and continued lack of co-operation, the trustee is very concerned that Pleterski's continued travel and extravagance is being funded by assets that should be surrendered to the trustee," wrote Jake Wiebe, a senior vice-president at Grant Thornton. 

It is also alleged that Pleterski used $13,000 worth of Scene points from his credit card for two luxury trips abroad last year as his victims are fighting to be refunded. Pleterski has claimed that a third party paid for his trips but there is no evidence of this yet.

One website alleges that Pleterski abandoned a $4.2 million mansion as his finances went awry, showing that this whole saga is far from over. Like many cases of crypto investors being defrauded, it could take many years to fully unravel.

Why People Fall For Crypto Scams

From the outside looking in, you might wonder why anyone fell for the Crypto King’s scams. After all, he is only 25 years old (meaning he was even younger when he duped his victims) and didn’t have any verifiable track record of investing. How was he able to get tens of millions of dollars out of people?

The answers to these are the same reasons why people fall for crypto scams of any type:

• FOMO

It is no secret that cryptocurrency is very profitable these days, with tokens like Bitcoin being worth tens of thousands of dollars per unit. As such, many investors are trying to get their hands on this profit. 

Simply put, lots of people are trying to make money from the ongoing crypto hype and this could lead to them turning to shady people like Crypto King to avoid being left out. This is why users need to exercise caution when playing at an anonymous casino or buying crypto from an unknown exchange, and should always check the platform is legitimate and well-reviewed before entering their details.

• Lack of Education 

Another reason why people fall prey to crypto scams is a lack of education about digital assets and investments as a whole. One of the core rules of investing is that no one can guarantee a return on principal, and this applies to crypto as well. 

In fact, it is arguably worse in the crypto sector because it is so novel and most people don’t have in-depth knowledge of it. Crypto King was able to prey on many people’s lack of education to convince them to hand over their money. Until crypto education is widely available, this will likely continue. 

• False Advertising 

One thing that sticks out in this Crypto King saga is the fact that social media was used for false advertising. Crypto King was known to post his flashy cars and lavish trips on social media and this gained him the trust of some of his victims. 

When a person doesn’t know much about crypto but sees a supposed trader living large from crypto, they might be tempted to invest in it to reap the same rewards. On top of this, this supposed trader is offering ‘guaranteed returns’ on their investment. False advertising has been used to lure in victims for many investment scams and this was no different. 

FAQs

• Who is the Crypto King?

The Crypto King is Aiden Pleterski, a Canadian man who was arrested for scamming investors of $30 million after claiming to be a crypto investor.

• How many people did the Crypto King scam?

Authorities do not yet know the total number of victims, though the total amount is pegged at $30 million 

• How can I avoid being scammed during crypto investments?

Do your due diligence about any asset you want to invest in, online give your money to accredited brokers, and only invest money you can afford to lose.