Feds raid digital currency firm accused of bilking investors

AP News
Posted: Oct 01, 2015 2:04 PM

ARCADIA, Calif. (AP) — Federal investigators have seized computers and boxes of evidence from Gemcoin, a digital currency firm based in Southern California that's accused of bilking tens of millions of dollars from Chinese and U.S. investors.

The San Gabriel Valley Tribune reports (http://bit.ly/1VrZW5S ) that U.S. marshals raided the company's Arcadia headquarters Tuesday.

The investigation follows a Securities and Exchange Commission complaint accusing founder Steve Chen of running a pyramid scheme. The agency accuses Chen and US Fine Investment Arts Inc., the company promoting Gemcoin, of committing securities fraud and misleading investors.

The SEC obtained a court order Monday to freeze the assets of 48 bank accounts associated with Chen and 13 companies he controls.

No arrests have been made. A woman who answered a number listed for Gemcoin hung up Thursday when asked about the raid. A phone listing for Chen couldn't be found.


Information from: San Gabriel Valley Tribune.