A New Zealand lawyer has called suspected pyramid scheme We Grow Bitcoins a “simple scam” after a news investigation.
In an article by local platform Newshub, consumer law specialist Prajna Moodley concluded that investors funneling money into the scheme, which promises 62 BTC ($148,300) monthly returns, would never see their cash again.
“I would go as so far as to say it's a simple scam, from what I can work this involves people investing money and never hearing from the company again," she told the publication.
The investigation focuses on the story of a New Zealand investor by the name of Daniel Tepania, who sent the so-called “crowdfunding community” the required NZ$30 minimum entry fee and is awaiting payouts.
"It's only been here about a month so I thought I would give it a go, sounded quite good," he told Newshub.
New Zealand’s Commerce Commission pointed journalists to its legislation on pyramid schemes when approached about We Grow Bitcoins, such schemes being illegal under local law.
“WeGrowBitcoins is a member to member donation platform,” the website states.
“Members pay a monthly subscription to have access to the platform. Platform access allows members to receive donations directly into their bitcoin wallet from other members.”
Cointelegraph would like to remind readers that investing in projects purporting to deliver unproven profits in return for direct payment should be avoided.