No More FUEL? Canadian Crypto Firm Vanbex Under Police Investigation

Vanbex Group, Canadian crypto firm is being investigated for fraud by selling their token named FUEL in an ICO scam.


ounded in 2013, Vanbex Group is a Canadian blockchain services company led by Kevin Hobbs and Lisa Cheng.

According to their website, their team of experts "help others develop innovative blockchain solutions to launch token offerings and create real-world solutions that provide better transparency and trust to traditional transaction-based systems."

The Canadian Police have now frozen assets of the founders as part of a fraud investigation based on their 2017 ICO(Initial Coin Offering). The assets frozen includes two Land Rovers, Hobbs's two bank accounts in Bank of Montreal containing around $1 million, and their Vancouver condominium.

Vanbex's business accounts have not yet been frozen. Vanbex Group raised a total of $30 million CAD or $22 million USD by selling their token named FUEL in an ICO. They told investors about Etherparty (a smart contract system) and “the value of the FUEL token would increase dramatically."

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The director of civil forfeiture at Canada’s Ministry of Attorney General stated that Hobbs and Cheng were unable to develop such products and instead used the money raised for their own personal gains.

According to court filings, Hobbs and Cheng:

“did not intend to develop the products they were marketing but rather [acted] with [the] intention to misappropriate the corporately invested funds raised for their own personal benefit."

The director of Civil forfeiture went on to say "FUEL tokens became virtually worthless in dollar value while not being capable of use in the non-existent smart contracts system or for any product or service other than a cryptocurrency coin creating service called Rocket.”

Hobbs and Cheng denied the fraud charges when contacted by CoinDesk, and said Vanbex is coorperating with the police and investigation.

<blockquote class="twitter-tweet"><p lang="en" dir="ltr">Goodbye office <a href=";ref_src=twsrc%5Etfw">#movingday</a><a href=""></a></p>&mdash; Lisa Cheng (@lisacheng) <a href="">March 29, 2019</a></blockquote><script async src="" charset="utf-8"></script>

Employees of Vanbex have been “encouraged [by the founders] to cooperate fully with the investigation and they are." Vanbex told CoinDesk the fraud allegations are false and was the result of “false claims by a former contractor.”

"We remain confident that the truth will prevail, and this will be behind us soon,"

The founders added in the interview:

"Unfortunately, these things move at a pace beyond our control. In the meantime, we will continue to innovate and deliver quality products. Our counsel are working to put this astern in a fashion that decisively confirms our leading role in this industry, which we intend to maintain.”

The Royal Canadian Mounted Police (RCMP) and the Canadian Revenue Agency (CRA) began investigating Hobbs and Cheng in May 2018. The court filings cited that Kevin Hobbs and Lisa Cheng "acquired sudden and substantial personal wealth" during the time of the ICO.

They purchased two condominiums worth around $3 million each in Vancouver and Toronto, two Land Rovers, and leased a Lamborghini worth $375,000. Hobbs also spent a substantial amount of funds on gambling domestically and internationally on a "high roller level."  

British Columbia Lottery Corporation has put Hobbs on a "watch list" since November 2017. Kevin Hobbs has been convicted in the past for possessing criminally obtained property and money laundering, and growing and trafficking in marijuana.

He was sentenced to nine months in 2008 and 30 months in 2009. His record is not so clean in the USA either, with a possession charge in New York in 2005. The founders of Vanbex attempted to liquidate their assets once they became aware of the investigation.

Vanbex Group continues to deny all fraud allegations and they ended the interview with CoinDesk by telling their stakeholders, "Thank you for your loyalty and trust. It is not misplaced."

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Marina L

Dog mom of two and nugget enthusiast. Reddit and video game addict. Co - founder of Vyntex Developments.