Crypto Scam Spotlight: New G; Founder Arrested!

Today in our Crypto Scam Spotlight series, we will look at a multi-million PHP online investment scam in the Philippines whose founder or "leader" was just arrested!

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NewG is a “bitcoin investment” company soliciting investments from investors blinding them with massive gains in a short amount of time. Normally, people can detect scams like these easily as such gains are not usually achievable in normal markets. However, investors weren’t as doubtful with NewG because its business model revolved around bitcoin investing.

The company started late last year at the time when bitcoin was performing really well even reaching its highest at $20,000 or Php 1,000,000. With such figures, a 40% return on investment (ROI) didn’t really seem suspicious to investors.

NewG offered investors a 30% to 40% ROI in as quick as 16 days! Their Facebook page featured this text:

Time frame: 16 days
10,000 = 1,500
50,000 = 10,000
90,000 = 20,000
160,000 = 40,000

Later in January, one investor reported that the minimum investment amount had gone up from Php 10,000 to Php 50,000.

NewG founder Arnel Ordonio and his associates also attracted new investors into the business by showcasing the extravagant lifestyle that the business allowed them to enjoy as seen in this video:

It’s also worth it to note that Ordonio, was fondly called by the investors as “boss” and the payouts to investors were called “pasahod” a Filipino word which roughly translates to “paying wages” in English.

Too Good to Be True

NewG investors did enjoy earnings but only up to a certain point. One investor from Davao claimed that payouts were good and consistent but only until December 2017. She had coaxed other people to invest in NewG and these people are now running after her for their money back. This group alone had lost Php 52 million ($1,040,000) to the scam.

Another victim explained that her family had invested Php 29 million ($580,000) to the scam.

In a press conference held today, Philippine National Police (PNP) Chief Ronald “Bato” De La Rosa said:

“If you encounter a scheme that is too good to be true, napakalaki ng interest, scam yan. Wag na kayo paloko.”

Rough English Translation:

“If you encounter a scheme that is too good to be true, interest is huge, it’s a scam. Don’t let it fool you.”

Founder Arrested

Arnel Ordonio and wife Leonady Ordonio were caught by the Philippine Criminal Investigation and Detection Group (CIDG) Anti-Organized Crime unit on April 4, 2018.

The Ordonios presented by PNP Chief Bato at a press conference | Photo from The Philippine Inquirer’s Twitter Account by Jhoanna Ballaran

The CIDG Chief Roel Obusan said that the police are still hunting down Ordonio’s associates and partners.

It is reported that a total of Php 900 million or $17.3 million was collected from investors.

What Happened to the Money?

Bitcoin’s value is not as high as it was before and the investments may be suffering a paper loss now. However, Ordonio had posted on his Facebook account last month screencaps that may indicate that the money may have been also used in bitcoin gambling via Cloudbet.

Rough English Translation of post:

“Let me just explain. You bought 20btc, withdrew 3.9 x 4 total of 15.6btc then played on my Cloudbet account and lost 50btc. So tell me if I’m wrong to change my own account’s password! You paid for 20btc but I lost 66.6btc. That’s not right!”

Indicating struggles between Ordonio, his associates, and other NewG “uplines” and members.

PNP Chief Bato cannot guarantee a full investor refund.

 

 

 


Spotlight Series Photo by Tyler Hendy

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