CoinDeal Scammers Nailed By SEC in $45 Million Fraud Case

U.S. Regulators are starting 2023 off with a new round of cases targeting cryptocurrency scams. Six individuals and two companies tied to an investment scheme called CoinDeal were charged on Wednesday by the U.S. Securities and Exchange Commission in the U.S. District Court for the Eastern District of Michigan.

“We allege the defendants falsely claimed access to valuable blockchain technology and that the imminent sale of the technology would generate investment returns of more than 500,000 times for investors,” said Daniel Gregus, Director of the SEC’s Chicago Regional Office.

The SEC has charged Neil Chandran, Garry Davidson, Michael Glaspie, Amy Mossel, and Linda Knott for their role in CoinDeal, a scheme the agency says raised more than $45 million from sales of what it calls unregistered securities to thousands of investors worldwide. The agency also filed charges against AEO Publishing Inc, Banner Co-Op, Inc, and BannersGo, LLC.

Chandran is already behind bars, awaiting trial in a separate investment fraud case under the U.S. Justice Department.

SEC Charges Trade Coin Club for $295 Million Bitcoin Ponzi Scheme

The U.S. Securities and Exchange Commission today hit four people with charges for allegedly swindling investors out of nearly $300 million in a “fraudulent crypto Ponzi scheme.” In a Friday announcement, the SEC said Trade Coin Club raised 82,000 in Bitcoin—worth $295 million at the time—from over 100,000 investors worldwide between 2016 to 2018.  Trade Coin Club promised investors “minimum returns of 0.35% daily” from a “crypto asset trading bot,” but it wasn’t true—and instead functioned as a...

“As alleged in our complaint, in reality, this was all just an elaborate scheme where the defendants enriched themselves while defrauding tens of thousands of retail investors,” Gregus said.

The SEC says the defendants used the money from the CoinDeal scam to purchase cars, real estate, and a boat.

The SEC seeks to reclaim the money allegedly stolen by the defendants along with pre-judgment interest, penalties, and permanent injunctions against all defendants.

From January 2019 to 2022, the agency alleges the group made false and misleading claims that investors could generate high returns by investing in CoinDeal, which the group promoted as a blockchain technology company. But in its filing, the SEC says no token sale or distribution ever occurred.

The defendants are charged with violating the antifraud and registration provisions of the Securities Act and Exchange Act.

Kim Kardashian to Pay $1.26 Million Fine for Illegally Shilling Ethereum Token

The U.S. Securities and Exchange Commission (SEC) today announced charges against Kim Kardashian for allegedly promoting what the commission has called “a crypto asset security.” The asset in question is the EthereumMax (EMAX) token the reality TV superstar and influencer promoted last year. Other celebrities involved in the promotion of EMAX, an Ethereum-based token that generated publicity last summer, included superstar boxer Floyd Mayweather Jr.—who famously appeared in a T-shirt with the EM...

This isn't the first run-in with the law for defendant Chandran. In June 2022, the U.S. Justice Department arrested and charged him with three counts of wire fraud for his role in defrauding investors in a separate scheme in which he falsely claimed to be developing a metaverse and a native cryptocurrency.

Among the 100 assets seized by the U.S. Marshals and FBI were bank accounts, real estate, and luxury cars—including 39 Tesla vehicles.

If convicted in the Justice Department case, Chandran faces 20 years in federal prison.