The US Securities and Exchange Commission (SEC) has charged the team behind Coindeal, a $45 million cryptocurrency fraudulent investment scheme. The regulator explained that the defendants falsely claimed that Coindeal “would generate investment returns of more than 500,000 times for investors”.
SEC Takes Action Against Coindeal’s Crypto Fraud
The U.S. Securities and Exchange Commission (SEC) announced on Wednesday that it had charged the creator of cryptocurrency investment scheme Coindeal and seven others in connection with the $45 million fraud.
Describing Coindeal as “a brazen and far-reaching unregistered bidding fraud conducted between at least 2018 and 2022,” the securities regulator detailed:
Coindeal…has raised more than $45 million from the sale of unregistered securities to tens of thousands of investors around the world.
The SEC explained that creator Neil Chandran and promoters Garry Davidson, Michael Glaspie, Amy Mossel and Linda Knott “falsely claimed that investors could generate extravagant returns by investing in a blockchain technology called Coindeal that would sell for trillions of dollars to a group of important and wealthy buyers.
However, the regulator said that no sale of Coindeal ever occurred and no distributions were made to investors. The defendants “collectively embezzled millions of dollars of investor funds for personal use and Chandran used investor funds to purchase items such as cars, real estate and a boat,” the SEC wrote.
The securities watchdog also indicted AEO Publishing Inc., Banner Co-Op Inc., and Bannersgo LLC for their involvement in the cryptocurrency investment fraud scheme.
Daniel Gregus, director of the SEC’s Chicago regional office, said:
We allege that the defendants falsely claimed access to valuable blockchain technology and that the impending sale of the technology would generate over 500,000 times returns on investment for investors.
The director added: “As stated in our complaint, in reality, this was just an elaborate scheme in which the defendants got rich while defrauding tens of thousands of retail investors.”
In June of last year, the United States Department of Justice (DOJ) indicted Chandran on three counts of wire fraud and two counts of money transaction in ill-gotten proceeds in connection with the Coindeal crypto fraud scheme.
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