Seeking Alpha
2023-01-04 22:38:27
The U.S. Securities and Exchange Commission, in its quest to crack down on illicit cryptocurrency activities, charged a group for their alleged involvement in what was described as a fraudulent investment scheme, called CoinDeal, which raised over $45M from sales of unregistered securities, according to a Wednesday release . Neil Chandran, the creator of CoinDeal, Garry Davidson, Michael Glaspie, Amy Mossel, Linda Knott, AEO Publishing Inc, Banner Co-Op, Inc, and BannersGo, LLC were all charged by the securities agency for ultimately defrauding tens of thousands of retail investors for their own personal gain. The SEC's complaint, filed in the U.S. District Court for the Eastern District of Michigan, alleged that Chandran, Davidson, Glaspie, Knott, and Mossel made false claims that investors could generate outsized returns by taking stake in CoinDeal that would be sold for trillions of dollars to a group of wealthy buyers. But no sale of CoinDeal ever happened and no distributions were made to its investors, the complaint said. Instead, "defendants collectively misappropriated millions of dollars of investor funds for personal use, and that Chandran used investor funds to purchase items such as cars, real estate, and a boat." The complaint seeks disgorgement plus pre-judgment interest, penalties, and permanent injunctions against all defendants; officer and director bars against Chandran, Davidson, Glaspie, Knott, and Mossel; and a conduct-based injunction against Chandran. Increased scrutiny of the currently troubled crypto space took told after November's multibillion-dollar collapse of crypto exchange FTX ( FTT-USD ). In December, the SEC reportedly expressed its concerns about crypto firms' audited proof of reserves .
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