A press release from January 4 stated that the U.S. Securities and Exchange Commission had filed charges against eight individuals who were involved in CoinDeal, a crypto-scam.
The SEC claimed that CoinDeal founder Neil Chandran, along with other individuals, operated a fraudulent cryptocurrency investment scheme.
CoinDeal’s perpetrators raised over $45 million by selling unregistered securities to investors. They promised high returns and insisted that CoinDeal’s blockchain technology would be sold to wealthier buyers for trillions of dollars.
CoinDeal did not sell the blockchain technology and never distributed any wealth to investors.
Daniel Gregus, the SEC’s regional director for Chicago, said:
“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.”
The scheme involved people who misused funds for their personal expenses. SEC officials note that Chandran used money to purchase vehicles, property, and a boat. An announcement from the past suggests that Chandran was forced to forfeit at most 100 assets.
Chandran has a long track record of fraud. The U.S. Department of Justice indicted Chandran on additional charges related to CoinDeal. He was indicted by the U.S. Department of Justice on felony charges relating to Sungame Corp. Canadian authorities arrested him in connection with the 2015 case against Platinum Equities Ltd.
Today’s complaint from the SEC also names four other individuals involved in the CoinDeal scheme: Garry Davidson, Michael Glaspie, Amy Mossel, and Linda Knott. The complaint also names three multi-level marketing organizations: AEO Publishing Inc, Banner Co-Op, Inc, BannersGo, LLC. There are various charges against the eight entities.
Recently, the SEC has taken on numerous cases related to crypto. Yesterday, the SEC announced that Cooper J. Morgenthau was facing charges for embezzling funds to invest in crypto. Today, the SEC tried intervene in a planned asset sell between Binance.US (Voyager Digital).
Other high-profile SEC cases that have been brought to light in recent years include Caroline Ellison (FTX associate), celebrity influencer Kim Kardashian and BlockFi, a lending company.