A report by OCCRP—the Organized Crime and Corruption Reporting Project—shows that Bankera’s founders used ICO funds raised to back loans to buy luxury real estate.
Leaked company records and bank statements revealed more than €45 million flowed from a Lithuanian firm owned by Bankera’s co-founders to Private Pacific Bank. The three co-founders acquired this bank just before the ICO ended.
Katherine Westmore, a senior research fellow from the RUSI (Royal United Services Institute), said the ICO proceeds were originally only meant for the Bankera project, raising the question of whether the actions constitute fraud.
“To extract funds and seemingly use them to finance personal spending raises suspicions that investors have been misled and [the co-founders] have profited personally,” said Westmore. “Fundamentally this seems to be about misrepresentation of what the [ICO] funds were going to be used for, which raises the question of whether this was a fraud.”
Bankera’s ICO raised over €100 million for what was supposed to be a blockchain-based bank that offered a range of retail and institutional investment services. While investor interest peaked during its ICO, Bankera’s progress in developing its infrastructure slowed down.
The company initially offered a weekly payout system, where investors could earn a yield from transaction fees from the buying and selling of the Bankera token. The payout would be based on their share holdings of the token. The scheme was supposedly halted in 2022, as reported by Cointelegraph.
The company still has to obtain a European Union Banking license.