According to digipro.geenius.ee, an online magazine in Estonia, Europe were DagCoin was founded:
2 weeks ago DagCoin founders Nils Grossberg and Kristjan Ress and 2 others were denied bail and remanded into custody for 2 months.
According to an other online source from Estonia, Postimees, (Google Translate):
In the spring of 2018, four Estonian men created an opportunity to acquire the virtual currency dagcoin. Dagcoin was promoted, among other things, through network marketing and sold on trading platforms created for this purpose.
The suspects gave the impression that dagcoin is a virtual currency whose development and sale process is carried out by independent and reliable persons, but it is suspected that the companies related to dagcoin were secretly managed by two of its creators.
District prosecutor Kristiina Laas explained that, according to the suspicion, the men provided false information in order to sell virtual currency. According to him, the price of dagcoin depended on the number of its users – the more people who accept dagcoin as a means of payment, the higher the price.
“Based on the data collected so far in the criminal proceedings, there is a reason to believe that the suspects have artificially increased the price of dagcoin and the number of its users in order to receive investment, creating a perception for the public as a functional and constantly increasing value virtual currency that can be used as a means of payment or earn income from its storage,”
According to preliminary data, this kind of activity has caused a loss of nearly 8 million euros to investors. Most of the victims are from foreign countries.
In order to prevent the suspects from continuing to commit crimes and avoid criminal proceedings, the prosecutor’s office requested the Tartu County Court to arrest the two suspects.
“The court found that the suspicion of a crime is well-founded, and to the extent that the suspects may continue to commit crimes while they are free, the court granted the request of the prosecutor’s office and took the men into custody for up to two months,”
According to Leho Lauri, head of the economic crimes office of the Central Criminal Police, the creators of dagcoin took advantage of a situation where the field of virtual currencies was practically unregulated in Estonia.
“Dagcoin was sold under companies with a virtual currency license, and the existence of a license was deliberately advertised to increase its credibility,”
“It was a dangerous situation, because the business license gave investors confidence and the courage to invest their money in dagcoin, but in reality it was possible to get a business license in Estonia with very little effort, and the reputation of our e-state was exploited,”
stated Laur and added that although by now laws have been tightened, the field of virtual currency still needs constant supervision.
The company’s license to provide virtual currency services in Estonia was valid from June 16, 2020 to June 15 of this year.
According to Lauri, it is difficult to recognize scams because criminals invest enormous resources in large-scale fraud schemes.
“Criminals often create websites that look genuine, imitate the techniques of real companies in customer communication and, for example, pay out profits to investors,”
he explained and added that these techniques are used to increase their credibility.
“When investing, you have to be extremely careful and take into account that absolutely every investment is accompanied by risk. The promise of big profits and near-zero risk is the first danger sign,”
added the head of the economic crimes office.
The proceedings are conducted by the economic crimes office of the Central Criminal Police under the leadership of the Southern District Prosecutor’s Office.
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