No, not endorsed by Elon! NJ cracks down on phony AI investment scam
⚫ NJ officials take down website plugging AI cryptocurrency
⚫ The website was improperly using Elon Musk avatars
⚫ The site also promised investors could interact with the Bitcoin founder
New Jersey officials have joined with other states to stop an artificial intelligence investment scam dead in its tracks.
The New Jersey Bureau of Securities, part of the Division of Consumer Affairs, has issued a Cease and Desist Order to halt the investment scheme, purportedly powered by artificial intelligence and endorsed by Elon Musk, and the website for TruthGPT Coin has been taken down.
The enforcement action was taken in coordination with several states bringing actions against Horatiu Charlie Caragaceanu and his organizations, The Shark of Wall Street and Hedge4.ai.
Artificial intelligence labs
Caragaceanu has described The Shark of Wall Street and Hedge4.ai as “artificial intelligence labs” that acted through “machine learning programmers and ethical hackers.”
According to the Cease and Desist Order, Caragaceanu and his organizations have been promoting TruthGPT Coin, a cryptocurrency that purportedly uses an artificial intelligence model called Elon Musk AI. This artificial intelligence model supposedly analyzes different cryptocurrencies, then predicts future digital asset prices, and is able to differentiate profitable investments from scams.
They are also claiming that TruthGPT Coin will increase in value by as much as 1,000 times.
Avatars and images
The Cease and Desist Order states the claims misrepresent Elon Musk's endorsement of TruthGPT Coin by manipulating animated avatars and images of Elon Musk to falsely demonstrate his endorsement. It is further alleged their promotional media falsely shows the involvement of various other public figures, including the founders of Bitcoin, Binance and Ethereum as part of the TruthGPT ecosystem, even though they are not.
The website also purports to incorporate a “communications platform” that allows users to interact with these and other public figures.
Bad actors underplaying risks
New Jersey Attorney General Matt Platkin said “these bad actors are making it seem like using artificial intelligence is a sure-fire get-rich-quick scheme, but they underplay the risks associated with investing and can potentially harm investors and their life savings.”
The Cease and Desist Order says Caragaceanu previously engaged in a series of initial coin offerings, deploying the tokens on the Ethereum blockchain and Binance Smart Chain. They touted the profitability of the tokens through internet websites and social media, claiming an early offering was tied to a “money making machine Artificial Intelligence Lab” that had “the potential to go 1000x. Not 100x. Not just 100x. It’s 1000x.”
The accused also told investors they could stake certain tokens to earn even greater profits — as much as 2,000% per year, officials said.
The fair market value of each token is now zero.
“Scammers are recruiting investors with advertisements on social media that contain flashy graphics, use technical terminology, and promise significant profits coupled with little or no risk,” Division of Consumer Affairs Cari Fais said. “But as we tell investors, if something seems too good to be true, it most likely is.”