SEC and FBI coordinate takedown of 4 fraudulent crypto firms
The United States Securities and Exchange Commission (SEC), the Federal Bureau of Investigation (FBI), and the Department of Justice (DOJ) have coordinated efforts to address alleged fraudulent activities involving four cryptocurrency firms.
According to the SEC, three market makers in the crypto space, along with several associated individuals, have been charged with fraud and market manipulation in civil suits filed in the District Court of Massachusetts on October 9.
The firms involved include Gotbit Consulting, ZM Quant Investment, and CLS Global, with nine individuals facing charges.
Gotbit Consulting and its marketing director, Fedor Kedrov, were accused of market manipulation through wash trading, a process where self-trading is used to simulate market interest.
The scheme allegedly involved promoting cryptocurrencies Saitama and Robo Inu, organised by Vy Pham, a Vietnamese citizen residing in California.
Pham was charged separately for her role in offering unregistered securities, fraud, and market manipulation.
Four others associated with Pham also face similar allegations, though Pham and two associates have consented to bifurcated settlements, allowing separate components of the charges against them to be settled.
The other two firms, ZM Quant Investment and CLS Global, were charged in connection with a coin called NexFundAI, which was created by the FBI.
Both firms, along with individuals linked to Pham, were also charged in relation to another crypto asset called SaitaRealty.
The SEC has sought permanent injunctions, civil penalties, and disgorgement of alleged ill-gotten gains.
FBI investigations have expanded to include other cryptocurrencies such as VZZN, Lillian Finance, and SaitaChain, with a total of 18 individuals and one additional company, MyTrade MM, facing charges.
According to the DOJ, the founders of VZZN and Lillian Finance have also been implicated in the case.
Disclaimer: The content of this article solely reflects the author's opinion and does not represent the platform in any capacity. This article is not intended to serve as a reference for making investment decisions.
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