Nesten – Ponzi Scheme and Investment Scam
Nesten is a decentralized platform with an extremely shady leadership. Its founders have a history of running investments scams.
The people behind Nesten are Park Nam-ho and Sunny Sun who have roped in Andrew Baek to become the face of their new scam.
Before, they used to run a highly notorious investment scam called Mining Max. The business model of Mining Max was quite similar to Nesten. Also, because Park Nam-ho had the funds from the previous scam, it was easy for him to launch a new company.
Currently, Nesten targets christians in particular. Sources reveal that they are targeting church-goers and promoting the scheme among them as an ‘alternative investment’.
Furthermore, Park Nam-ho and Sunny Sun have used their funds to get Andrew Baek who has a strong academic background. Probably, they did this to add more credibility to their brand.
To understand how Nesten is scamming consumers, you will need to understand the past venture of Park Nam-ho and Sunny Sun: Mining Max.
The Crypto Scam of Mining Max and Its Connection to Nesten:
For US residents, Mining Max might not be a familiar name. However, it was a major scam in Korea. The fraudulent scheme was able to generate around $80 million for its formulators, namely Nam-Ho Park and Sunny Sun.
Mining Max succeeded in getting many investors through the false promise of generating profits through Ether mining.
By 2018, Mining Max had become one of the largest cryptocurrency scams in Korea. Media reports reveal that it was the brainchild of Sunny Sun, younger sister of Paul Sun and Nam-Ho Park.
They formulated the scheme in the US and launched it in Korea.
The English name of Nam-Ho Park is Daniel Park. He was the CEO of Mining Max and had performed a similar scam through the GSM Card multi-level scheme. Currently, he is running Nesten.
Through that scheme, he was able to sell 120,000 units in the US and Korea.
Also, reports indicate that he had already made a fortune in Korea by committing similar frauds.
Because the amount of money lost among individual victims was small, nobody bothered to report his initial scam.
Judging from the scale of the operation, media reports estimated that the scam was worth tens of billions of won (Korean currency).
When the Nesten founder was running the GSM card scheme, he had already begun working on Mining Max. Moreover, he invested most of the money he made from the multi-level card scheme into the crypto mining venture.
Then, he created a real estate and entertainment company along with pseudo-subsidiaries such as Inomite and Innochain.
Why did he establish so many expensive companies?
Media reports suggest that these companies helped Park clean the money he had made from his fraudulent schemes. Apparently, he took the help of his lawyer friend, Lee Jin-ho for this task.
How The Scam Worked:
Sunny Sun is a real estate broker who partnered with Nam-ho Park to run this scam.
In 2016, Ethereum was gaining popularity as the new and powerful cryptocurrency. The duo recognized the potential in this cryptocurrency and began marketing Ethereum mining machines.
With Mining Max, you would get an Ethereum mining machine for 2 years at a 80:20 share on the mined coins.
Certainly, they have replicated this model with Nesten where clients have to buy machines as well.
Although Mining Max seemed attractive at first, the mining machines weren’t generating enough cryptocurrency to distribute amongst investors.
So, they began following a multi-level marketing approach. It worked.
That is why I believe Nesten is a dangerous scam. It is following the footsteps of Mining Max but the difference is in the targeted demographic.
Mining Max was able to raise 270 billion won and to deliver over 18,000 Ethereum mining machines. If you include the Korean Americans, the size of the scam might increase up to $80 million.
The number of machines they actually delivered was merely 10% of the total orders they received. Furthermore, the company producing these mining machines wasn’t a proper firm.
In fact, it was a poor assembly plant which didn’t manufacture most of the machines properly. So, it stopped shipping within a few months.
I suspect Nesten is on the similar path. It doesn’t share much details about the manufacturer of its “machines” and markets itself as a company that wants to ‘decentralize’ processes.
Sunny Sun Managed the Scam in the US:
According to media reports, Sunny Sun was managing this scam in the US. She was incharge of getting Korean Americans to invest in the scam.
That experience must be playing a huge role in deciding who to target for Nesten in the US.
When they were running Mining Max, they kept increasing the price of the miner and the victims didn’t even question it. They were investing their savings, including their retirement funds for this scam.
Basically, they were misleading investors into thinking they were buying mining equipment while in reality, they were only investing in their mining business.
Park Nam-ho, Sunny Sun and Lee Jin-ho keep claiming that it’s not their fault thousands of people lost their investment.
Rumors say Sunny Sun underwent plastic surgery with the money she made from this fraudulent scheme.
For example, a 44-year old housewife had invested 60 million won into this scheme. Like her, there are hundreds of victims who lost their hard-earned savings.
How Nesten is a Replication of Mining Max:
Now that you know the scope of Mining Max and how it scammed thousands of Korean consumers, it would be easier for me to highlight how Nesten is doing the same thing here in the US.
The company has a shady website which doesn’t share any details about its ownership. Why?
Probably, because they don’t want potential victims to find out about their shady past.
Sources reveal that Sunny Sun and Nam-ho Park are promoting Nesten among church goers. They are making the same claims they made with Mining Max. Moreover, the result is the same.
Consumers are getting promised that they will earn great returns from the mining equipment they are investing in. Also, Nesten is putting off the delivery of additional equipment just like Mining Max.
However, because the scam is running in the US, the scale of this scam can be substantially higher.
I believe Nesten can easily turn into a $50 million+ scam within a few years.
Currently, their PR articles say that the company will sell its blockchain technology through ‘network hubs’.
Sunny Sun and Park Nam-ho are living in Irvine and they have started targeting local residents.
A female pastor has begun promoting their product among missionaries, evangelists and clerics. She promises them that they will use the revenue for missionary work so many are promoting this scam readily.
Furthermore, the pastor tells the christian victims that she invested in Nesten with hope. Some pastors who have made substantial investments in Nesten are Kwon Sa Kim and Mo Park.
Nesten Machines Don’t Arrive, Buyers Get Anxious:
Still, even though many people have bought mining machines from Nesten, they haven’t received the equipment. It’s been over a year since they placed their orders.
To counter the dissatisfaction among various investors, Nesten began handing out their coins to them. Those who haven’t received their machine are getting 15 coins per machine.
Also, the price of one G1 machine is 3500. At the time Nesten was handing them out coins, the value of the coin was around $20 but now it has fallen to ten cents or less.
Furthermore, sources have revealed that Nam-ho Park and Sunny Sun are planning to buy land to start a nursing home business. Beware.
More Information About Nesten:
Clearly, a huge reason behind the current success of Nesten is its CEO and CTO Andrew Baek. After all, he is the face of the company.
According to his social profiles, Andrew Baek is based in Tustin, California. Before running Nesten, he was a member of technical staff at Lucent Technologies Bell Labs from 1997 to 2001.
Then, he became the CEO of Troicom from April 2005 and has been at that position since.
Also, he is also the CEO of Citius Systems.
Andrew Baek has a BA in Physics from Cornell University and a PhD in Electronics and Communications Engineering from University of Pennsylvania.
Surely, he seems like a perfect candidate to make the face of a company. Nobody would suspect the intentions of the company when its CEO & CTO is highly qualified.
There are plenty of red flags in Nesten.
For example, their website doesn’t give much information about the company except sharing some basic details about blockchain and decentralization:
There is no “About Us” page on their website, another huge red flag:
In fact, Nesten doesn’t even give a contact number or an office address.
Also, the Quick Start guide has plenty of mentions of their G1 device. Considering the company pays out its clients through their own “wallet”, I don’t think many investors will be getting any actual money.
There are plenty of scams that utilize the tactic of paying ‘fake’ money. For example, QuinReward is a company that’s facing charges of fraud because it promises to pay people in points in exchange for actual funds.
Another scam that utilizes this tactic is Tiger Trade Copy. They have received complaints for showing ‘fake trades’ on their platform and rigging them to charge heavy fees.
Such scams are becoming increasingly popular.
After reviewing the media reports and seeing the history of Nesten’s leadership, it’s obvious that the company is a scam.
Nam-ho Park and Sunny Sun have deliberately avoided putting their names on Nesten’s website to make it seem legitimate.
They are using Andrew Baek as a face to make sure the company gets ample investors.
Nesten claims to be a blockchain company but its business model indicates it’s nothing more than a Ponzi scheme. The company’s leadership has a history of running similar scams in Korea and the US.
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