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FIRE Investors Allege Fund Grab, Owner Moves to Dismiss Case

Daniel Ianello, a man accused of orchestrating an exit scam involving a crypto project known as The Phoenix, has filed a motion to dismiss a lawsuit brought against him in a Tennessee federal court.

According to the complaint, Ianello took over Phoenix Community Capital in October 2022 and allegedly executed an exit scam.

After taking control of The Phoenix’s (FIRE) assets, he allegedly shut down its smart contracts. Plaintiffs claim he then “moved hundreds of thousands of dollars in investor money, began deleting posts on Discord […] deleted earlier versions of Phoenix’s website, and announced the ‘smart contracts’ would not be restored.”

In his motion to dismiss, Ianello claimed that he is a Michigan resident with no purposeful contact with Tennessee. The filing states: “This court does not have personal jurisdiction over Mr. Ianello. Mr. Ianello is domiciled in the state of Michigan.”

Ianello also claimed that he had never sold any securities, since he joined the company by acquiring its assets only after any alleged sales. He claimed he made no statements about offered investments and that the plaintiffs are lumping him in with The Phoenix and its founders.

The now-deleted The Phoenix website as of Jan. 8, 2022. Source: Wayback Machine

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Project made bold promises

According to its CoinMarketCap page, The Phoenix leveraged its “large capital pool of community assets” to access investment opportunities unavailable on the retail market. The returns on those investments were promised to be distributed among tokenholders through a profit release.

The Phoenix also promised an in-house incubation program that allowed the management team to fund, create and manage new projects. This, in turn, would lead to “high percentage profit sharing” by the community.

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Crypto scams are a hot topic

Scams remain a persistent issue in the crypto space. A Tuesday report by blockchain security firm CertiK claims that losses to crypto hacks, exploits and scams spiked to $2.47 billion in the first half of 2025.

As Cointelegraph reported on Friday, the self-claimed victim of a crypto romance scam who recently sued Citibank for missing red flags has just filed a second lawsuit targeting two other banks.

A man at the center of a crypto Ponzi scheme will spend nearly eight years behind bars after a federal judge handed down a 97-month prison sentence in Brooklyn, New York, in late June.

Magazine: Fake JD stablecoins, scammers impersonate Solana devs: Asia Express