On August 13, 2025, California’s Department of Financial Protection and Innovation (DFPI) issued a desist and refrain order against Beonbit Pty Ltd, prohibiting the company from offering or selling unqualified securities in California, per DFPI’s official enforcement action. The order cites violations of the California Corporate Securities Law (CSL) under Corporations Code section 25110, as Beonbit sold investment contracts through its website without qualification or exemption since early 2025, per. The DFPI found no permit authorizing these sales, leading to the cease order effective immediately, per.
Beonbit, launched in late 2023 and gaining traction in late 2024, operated as an MLM crypto Ponzi scheme promising 1-5.6% daily returns via AI-powered trading, per. Fronted by a fictitious CEO “Richard Bates”—portrayed by an actor with an Eastern European accent in staged videos—the scheme targeted global investors, including in Germany, Austria, and Australia, per. It collapsed in May 2025, coinciding with a pyramid fraud alert from Russia’s Central Bank, per. The Boris CEO tactic, common in Russian/Ukrainian Ponzi schemes, masked operations, with no verifiable trading or external revenue, per.
Austria’s Financial Market Authority (FMA) issued a fraud warning in April 2025, labeling Beonbit’s investments as unlicensed, per. The scheme’s MLM structure rewarded recruitment over legitimate trading, leading to widespread losses, per. As of July 2025, Beonbit’s website saw 307,000 monthly visits, primarily from the U.S. (31%), Germany (12%), Cote d’Ivoire (12%), Switzerland (11%), and Hungary (6%), indicating a shift to new markets after declines in Australia and France, per. X users like @SyedNaeemshah03 have called for international action, including from the UN, to recover funds, per.
The DFPI order, part of broader U.S. enforcement against crypto fraud, underscores risks in unregulated MLM schemes, similar to PGI Global ($198M losses) and Forsage ($340M), per. Bitcoin (BTC) ($117,286) and Ethereum (ETH) ($4,070) remain stable, per CoinMarketCap, but Beonbit’s collapse highlights DeFi vulnerabilities. Victims should submit complaints to DFPI at dfpi.ca.gov and report to the FBI via ic3.gov, per. Diversify into regulated assets like USDC or ETH with stop-losses below BTC’s $112,000, per TradingView. Follow @TheBlock__ on X for updates. This case may prompt stricter state-level oversight, per.
