Seele ICO Investors Stung in $2 Million Telegram Group Scam
Potential investors in the upcoming Seele ICO claim they have been robbed of over $2 million in ETH, by members of a trusted project group or those impersonating them. Two accounts listed as approved admins in the project’s Telegram group, “SeeleSupport” and “nicsmith”, allegedly solicited ETH for private sale from syndicate pools, then disappeared.
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What Is Seele?
According to its website, Seele is a blockchain project with potential applications for fintech, e-government, IoT, game assets and others. Its main selling point is a “neural consensus protocol”, and the main blurb on the project’s homepage reads as follows:
“Seele is powered by an up-scalable Neural Consensus protocol for high throughput concurrency among large scale heterogeneous nodes and is able to form a unique heterogeneous forest multi-chain ecosystem.”
The official sale of 1 billion ERC-20-based “SEELE” tokens was due to commence soon.
Investors See Funds Vanish
Earlier today, some members in the ICO pool began to report ETH funds missing, after they’d sent them to Telegram group admin accounts.
The startup has now warned potential investors to beware of impersonators and issued this apology to the Telegram group:
“We are deeply sorry for the problem caused by the “@seelesupport” and “@nicsmith” scammer and are taking full responsibility for it. We care about our community and are taking all necesarry precuations to prevent something like this from happening again.”
“It appears as due to the intentional deceiving of the “@nicsmith” and “@seelesupport” scammer by impersonating one of our own team members, some people from our community have lost funds. We are herby acknowledging the situation and confirm that we will find solution to make the situation right for all community members who have lost funds due to this problem.”
However it’s probably too late for those who’ve already lost funds. A victim pointed to the following Ethereum address as the recipient of the illicit transactions. It now holds around 2,162 ETH, or just over $2 million USD in value.
Yet, contact was made with the alleged “Nick Smith” through private message about a private sale of tokens. That Nick Smith – which Seele says is an impersonation — suggested they contact @SeeleSupport.
Around 02:00 AM GMT today, a pinned message and multiple messages in the official Seele Telegram group started to alert members to a potential scam claiming to be associated with the project’s token sale.
The @SeeleSupport and @nicsmith accounts were removed from the list of approved admins.
It appears that Nick Smith’s account was indeed compromised. An identity claiming to be Nick Smith messaged another member named “Rebecca”, presumably @Rebecca666, offering to help out on the Telegram chat group.
Who Was Controlling the Telegram Accounts?
It remains unclear who is controlling the @SeeleSupport account, and whether they were ever part of the official Seele team, although they are listed as such.
Another admin known as “Dan” was also directing investors to direct message @SeeleSupport with questions.
What is clearer, however, is that people were duped into sending money to an ETH address through private messages.
Will Seele Take Care of Robbed Investors?
Not surprisingly, some investors have accused Seele itself of stealing investors’ money. Some insist that as only an admin can make someone an admin, that it must be, to an extent, an “inside job”.
Seele insists that impersonators are responsible for requesting money, and were not a part of the official Seele line-up. The Seele ICO had yet to commence its ICO pre-sale, with the white list scheduled for next week.
Bitsonline reached out to “Tiger”, the admin who has assumed control of the chat group, and asked if investors would be reimbursed for any losses. His reply said simply “We will take measures on this issue.” We followed up to clarify if that meant actual reimbursements, but the response was unclear.
The latest group Telegram message from Tiger insists both the @nicksmith and @SeeleSupport accounts were compromised and assures those who were defrauded that Seele “are taking full responsibility for it”.
Theft Serves as Further Warning to ICO Investors
Other aspects of the Seele ICO have raised questions too. The contact email for technical/billing/admin behind their URL is [email protected] A quick Google search of that email address produces a number of results indicating its association with scams, dating back to at least 2014.
At the time of writing, confusion abounded and many details remained unclear. As always, the events over the past 24 hours in relation to the Seele ICO provide yet another reminder to investors to never send money to people you do not know through unofficial channels.
It also serves as a caution to ICOs themselves to double-check their admin policies and ensure they are as organized as possible. IPO-standard rigors may not apply to ICOs, but any start-up seeking funding from investors needs to show a commitment to being organized, transparent, and in control.
What do you think happened in the Steele Telegram channel? Let’s hear your thoughts in the comments.
Images via Seele.pro, Telegram