It is indeed a huge scam network. Scams will typically either take offshore companies or simply invent fake companies. Only rarely, they are operated by companies in Europe as is the case with the Capital Letter scam network. Capital Letter GmbH, registered in Munich, Germany, with company registration number HRB 242418, was the operator of several large scams until the end of 2020. In addition, two other companies also registered in Germany, Brunnlitz GmbH and Tokkata Software GmbH, participated in the scams. All three companies are operated by Ukrainian individuals; all received warnings from regulators.
The regulatory warnings
The Capital Letter scammers are apparently based in Ukraine and until recently used their German entitiesto run their scams, obtain bank accounts, and launder their illegal proceeds. Ukraine is known to be the home to many large illegal boiler room operators. The directors of the three German entities are :
- Capital Letter GmbH – Artem Dari (Companies register)
- Brunnlitz GmbH – Anatolii Zmeul (Companies register)
- Tokkata Software GmbH – Mykhailo Kalinin (Companies register)
Various financial market regulators have issued warnings against the scams of the Capital Letter network. Some of the warnings are listed below.
- May 2020 – the UK FCA issued an investor warning against BrightFinance operated by German Capital Letter GmbH.
- July 2020 – the German regulator BaFin issued a Cease and Desist Order against Capital Letter GmbH and its brands STSRoyal, GFXRoyal, GFXCrypto, and BrightFinance.
- August 2020 – the Austrian FMA followed suit with a warning against Capital Letter GmbH and its GFXRoyal scam.
- October 2020 – the UK FCA issued a warning against the illegal broker Solid Invest and its operator with a German address.
- March 2021 – the BaFin issued a Cease and Desist order against Solid Invest, FXPoint (www.fxpoint.co), and 24Trading (www.24trading.co) allegedly operatedy by Grey Matters Enterprise Ltd and FX Point Ltd.
- April 2021 – BaFin followed in April 2021 and ordered Grey Matter Enterprise Ltd to cease the activities of Solid Invest (www.solidinvest.co).
- April 2021 – Spanish CNMV issues investor warning against Grey Matter Enterprise Ltd and Solid Invest (www.solidinvest.co)
- July 2021 – Swiss FINMA warns against Wellington Holdings (www.wellingtonholdings.com)
Illegal payment services
The two companies registered in Berlin, Tokkana Software GmbH and Brunnlitz GmbH, share the address for their registered office at Xantener Strasse 2. BaFin found in its Cease and Desist Orders that both Brunnlitz GmbH and Tokkata Software GmbH are operating as illegal payment processors and have conducted financial transfer business for scams such as STSRoyal or STSCrypto.
The fake companies
After the Cease and Desist Order was issued by the German regulator BaFin against Capital Letter GmbH, other fake companies were used on the websites as purported operators. However, the scammers continued to use the Capital Letter company number HRB 242418 and its registered office address at Adolf-Kolping-Strasse 16 in Munich, Germany. For example, Solid Invest currently states Grey Matters Enterprise Ltd as the operator with the company registration number of Capital Letter GmbH. Grey Matter Enterprise Ltd does not exist according to our findings.
White label mutations
Besides the company number and the address, these Capital Letter scams also have in common that they run on the same CRM platform and are very similar in look and feel.
The Solid Invest scam is already disappearing after the many warnings over the last few months. Currently, deposits are no longer possible with Solid Invest. The currently active scams of the Capital Letter network are apparently Wellington Holdings (www.wellingtonholdings.com), Cento GX (www.centogx.com), and FinoMarkets (www.finomarkets.com), which are supported by the payment processors SysPay, Texcent, Coinicash, and AdvCash.