Montana State Auditor and Commissioner of Securities and Insurance Troy Downing says his department is joining Alabama and Texas and is taking enforcement actions to stop a fraudulent artificial intelligence firm from operating in the Treasure State.
The company is YieldTrust.ai and its CEO Stefan Ciopraga is accused of illegally soliciting investments tied to an application that says it uses quantum artificial intelligence to trade digital assets.
Downing’s department has ordered the company to cease and desist what it deems to be a “Ponzi scheme” and all financial activity in Montana. The commissioner also wants the firm to pay $100,000 in fines.
“YieldTrust.ai is allegedly claiming the YieldBot is powered by cutting-edge artificial intelligence designed to interact with the market for digital assets,” the commissioner’s department said in a news release. “It is purportedly touting the sophistication of the artificial intelligence, claiming it is ‘capable of executing 70 times more trades with 25 times higher profits than any human trader could.’”
The news release also says, “YieldTrust.ai is also allegedly claiming the artificial intelligence continuously evolves, as the YieldBot ‘continually improves itself…becoming more effective with each trade made.’”
The department said Yieldtrust.ai did not provide any proof to investors that this AI trading bot even exists, let alone that it is performing at the level Yieldtrust.ai claims.
“The promised profits are highly lucrative – YieldTrust.ai is allegedly claiming the YieldBot generated returns of 2.6% per day for four months and new investors can expect to earn up to returns of up to 2.2% per day,” the news release stated.
Downing’s department warned that artificial intelligence and machine learning are generating quite a bit of public interest. Scammers are hip to that and are working overtime to find “investors” to line their pockets. “Artificial intelligence may be an exciting concept, but scammers are attempting to capitalize on the excitement by developing high-tech ploys to deceive investors – while playing on their emotions by falsely promising lucrative profitability and the once-in-a-lifetime opportunity to secure financial freedom,” the news release concluded. “We are uncovering an increasing number of promotions for illegal and fraudulent investments tied to artificial intelligence. This action is likely just the tip of the iceberg.”