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The US Securities and Exchange Commission has sued Boaz Manor, a convicted criminal who is alleged to have fashioned a fake identity in order to dupe investors into purchasing shares in a Bloomberg-like “Blockchain Terminal” that allegedly never existed beyond a prototype.
Manor, a Torontonian, changed his name to “Shaun MacDonald,” “darkened his hair, grew a beard, and used aliases to hide his identity,” according to the SEC’s statement, filed Friday. He allegedly did this in order to “conceal the fact that he had served a year in prison after pleading guilty to criminal charges arising from the collapse of a large Canadian hedge fund.”
The agency is suing Manor for anti-fraud and securities violations, and seeks to claw back the allegedly ill-gotten gains “plus interest, penalties, and injunctive relief,” according to the statement. The SEC also seeks to bar Manor and Edith Pardo, his associate, from running public companies or securities offerings.
Manor characterized Pardo as his employer and the owner of Blockchain Terminal while running the business behind the scenes, the SEC alleges. He allegedly disclosed that he had hidden his true identity from investors in order to prevent “the company being destroyed.”
Manor’s antics were the subject of extensive reporting in late 2018 by industry news site The Block. The site was subsequently threatened with a lawsuit, which was addressed to the wrong person and described by one lawyer as the “kind of lawsuit that clutters the legal system and wastes everyone’s time.”
Blockchain Terminal also “claimed to have 20 hedge funds testing technology to record transactions on a distributed ledger or blockchain,” the SEC alleges. “In reality, the defendants had only sent a prototype to a dozen funds, and none of the funds used it or paid for it.”
“Learning about the identity and background of the individual or individuals behind a venture is one of the first things we tell investors to do before trusting anyone with their money,” Joseph G. Sansone, Chief of the SEC’s Market Abuse Unit, said in a statement Friday.
“As alleged in our complaint,” he added, “Manor’s brazen scheme to conceal his identity and criminal history deprived investors of essential information and allowed defendants to take over $30 million from investors’ pockets.”