SEC issues charges in crypto investment scams

The Securities and Exchange Commission has charged Ryan Ginster with conducting two unregistered and fraudulent securities offerings. Through this scheme, he raised more than $3.6 million in cryptocurrency from retail investors.

According to the complaint filed by SEC, during the period between 2018 and 2021, Ginster raised $3.6 billion in Bitcoin using the online platforms and Social Profimatic. The platforms “promised astronomical rates of return” the official announcement said. The returns would be gained to a “cryptocurrency trading and advertising arbitrage.” The SEC alleges that Ginster deceived investors about how their money would be used. In reality, he used the funds to pay personal expenses, including tax payments, housing expenses, and credit card bills.

SEC fraud

Michele Wein Layne, Regional Director of the SEC’s Los Angeles Regional Office, said:

Defendant Ryan Ginster allegedly engaged in a fraudulent scheme raising millions in cryptocurrency using online investment programs and then converted the cryptocurrency for his own benefit. Individuals who hide behind the anonymity of cryptocurrency transactions to defraud investors should expect that the SEC will trace their illegal activity and hold them accountable for their actions.

Ginster has been charged with violating the antifraud and registration provisions of the Securities Act and the Securities Exchange Act. The SEC’s complaint is seeking permanent injunctions, disgorgement with prejudgment interest, and civil penalties.

Last month, CFTC and SEC separately charged SwapStar with investment fraud.

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