ProCap Newsletter No. 71

Dear Clients,

As part of our continuing updates concerning the ProCap case, this week we would like to address an issue that can become particularly important when assessing losses in online investment fraud cases: the difference between the balance displayed on an investment platform and the amount of money that an investor actually transferred and lost.

For many investors, the last balance visible on their ProCap account may appear to represent the value of their claim.

However, in cases involving potentially fraudulent trading platforms, that figure must be approached carefully.

A balance displayed on a platform is not necessarily money that actually existed

Online investment platforms may display deposits, trading profits, bonuses, interest, commissions or other increases in an investor’s account balance.

The fact that these amounts appear on a dashboard does not, by itself, establish that corresponding funds were actually held in an account for the investor or generated through genuine trading activity.

This distinction becomes particularly important when an investor deposited, for example, a certain amount of their own money but later saw a substantially higher balance displayed on the platform.

If the additional amount consisted of purported trading profits that were never actually withdrawn or independently verified, it may need to be treated differently from funds that the investor can demonstrate were actually transferred.

What is usually easier to establish?

The strongest starting point is generally the actual movement of funds.

Bank statements, card transactions, cryptocurrency transfers and other payment records can show how much money an investor actually transferred and to whom.

Records of successful withdrawals are also important because they may affect the calculation of the investor’s net financial loss.

For example, the fact that an investor transferred funds on several occasions but also successfully withdrew part of those funds may be relevant when determining the amount that was ultimately lost.

This is different from simply taking the highest or final balance displayed on the platform as the amount of the loss.

What about profits shown on the trading account?

Displayed profits may still be relevant evidence.

They can help demonstrate how the investment was presented to the client, what representations were made concerning performance and how the platform encouraged further deposits or discouraged withdrawals.

However, their evidentiary role may be different from that of funds that can be independently traced through a bank or blockchain transaction.

A platform screenshot showing a balance of €100,000 does not necessarily establish that €100,000 existed and was available for withdrawal if the investor’s actual transfers were substantially lower.

Bonuses and account credits require particular caution

Some investment platforms credit accounts with bonuses, promotional amounts or other internal credits.

Such amounts can make an account appear considerably more valuable than the amount actually invested.

They may also be accompanied by conditions restricting withdrawals until additional trading, deposits or other requirements are completed.

For this reason, it is important to preserve evidence showing not only the final balance but also how that balance was created.

Deposit history, trading history, bonus records, withdrawal requests and communications with account managers may all help explain the figures displayed on the account.

Why does this distinction matter for ProCap investors?

If a legal or recovery process eventually requires the losses of individual investors to be established, the relevant amount may need to be supported by evidence rather than simply taken from the last figure displayed by the platform.

This does not mean that screenshots or account statements from ProCap are unimportant.

On the contrary, they should be preserved because they may provide valuable evidence concerning the operation of the platform and the representations made to investors.

However, they should ideally be considered together with independent evidence of payments and withdrawals.

For this reason, please continue to preserve bank statements, payment confirmations, cryptocurrency transaction records, platform account statements, screenshots of balances and trading activity, withdrawal requests and related communications.

At present, there is no additional action required from our clients and there is no need to resend documentation that has already been provided.

The purpose of this update is simply to explain why, in investment fraud cases, the amount displayed on a platform and the amount that may ultimately be established as an investor’s financial loss are not necessarily the same.

We will continue to monitor developments concerning ProCap and will inform you when verified information emerges that affects the case or requires any action on your part.

Thank you for your continued patience and trust.

Kind regards,

Attorney Zoran Miljaković