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U.S. authorities filed charges against a purported crypto mining firm, alleging that investors worldwide were duped in a pyramid scheme.

The U.S. Securities and Exchange Commission (SEC) filed fraud charges against MCC International Corp. (MCC) and its founders, Luiz Carlos Capuci, Jr. and Emerson Souza Pires, along with two other companies controlled by Capuci — CPTLCoin Corp. and Bitchain Exchanges.

Capuci was also criminally charged with conspiracy to commit wire fraud, conspiracy to commit securities fraud, and conspiracy to commit international money laundering.

The allegations have not been proven.

The SEC alleged that MCC generated US$11.3 million from selling crypto-mining packages to more than 65,000 investors around the world, promising returns generated by crypto-mining and trading in stocks, foreign exchange and crypto.

However, according to regulators, it was a sham.

“MCC was a Potemkin village for the digital age,” the SEC said in its complaint. “There was no mining for cryptocurrency. No trading robots. No trading. MCC might have created its own crypto asset, but it had no real value. MCC had one, and only one, source of revenues: Its unsuspecting investors.”

The criminal indictment alleged the scheme amounted to a US$62-million global investment fraud, and that Capuci recruited affiliates to promote MCC and its various investment programs through a typical pyramid scheme.

The scheme took money from unsuspecting investors based on “false promises of outlandish returns and used investor funds raised from this fraudulent scheme to fund a lavish lifestyle, including purchasing Lamborghinis, yachts, and real estate,” said Kristina Littman, chief of the SEC enforcement division’s cyber unit, in a release.