SEC accuses crypto platforms and investment clubs of $14 million fraud

Key points:

• The SEC has filed charges against seven organizations, including three crypto platforms and four investment clubs.
• The fraudulent scheme operated from January 2024 to January 2025 and attracted more than $14 million.
• Investors were lured through social media and WhatsApp with promises of stable returns and “AI tips.”

The US Securities and Exchange Commission (SEC) filed a lawsuit in the Colorado District Court, accusing seven organizations of involvement in a fraudulent crypto investment scheme. According to the regulator, the victims were retail investors who lost at least $14 million.

The SEC claims that the scheme was actively promoted through social networks and messengers, where potential investors were lured into closed investment communities under the guise of educational and analytical clubs.

How the scheme worked

According to the case file, advertisements on social media directed users to investment clubs that operated primarily on WhatsApp. In group chats, the fraudsters posed as financial experts and published supposedly analytical recommendations, including the use of “AI-generated investment tips.”

Participants were then persuaded to open and fund accounts on the Morocoin Tech Corp., Berge Blockchain Technology Co., Ltd., and Cirkor Inc. platforms. The SEC claims that these trading platforms were entirely fictitious and did not conduct any real transactions, despite claims of licensing and government oversight.

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According to the SEC, the scheme was complemented by the promotion of fake security token offerings. Neither the tokens themselves nor the issuing companies existed in reality. When attempting to withdraw funds, investors were forced to make additional advance payments under various pretexts, which led to further losses.

The regulator said the stolen funds were transferred abroad through a network of bank accounts and cryptocurrency wallets, making them difficult to trace.

Last month, Interpol officially recognized crypto fraud as a global criminal threat and pointed to the growth of transnational schemes involving money laundering through cryptocurrencies. The organization’s resolution states that criminal networks use stablecoins, low-fee blockchains, and cross-chain operations to conceal the movement of funds, which requires coordination between law enforcement agencies in different countries.