Kevin Helms
A student of Austrian economics, Kevin found Bitcoin in 2011 and has been an evangelist ever since. His interests lie in Bitcoin security, open source systems, network effects and the intersection of economics and cryptography.
SEC files emergency action against Bkcoin in $100 million crypto fraud scheme – Regulation Bitcoin News
The US Securities and Exchange Commission (SEC) has filed an emergency action against Miami-based investment advisor Bkcoin and one of its clients, Kevin Kang. “The defendants disregarded the structure of the funds, commingled investors’ assets and used more than $3.6 million to make Ponzi-like payments to fund investors,” the SEC alleged.
SEC’s ’emergency action’ against Bkcoin, Kevin Kang
The US Securities and Exchange Commission (SEC) announced on Monday that it has filed an “emergency suit” against Miami investment advisor Bkcoin and one of its principals, Kevin Kang, “for orchestrating a $100 million crypto fraud scheme.” The securities regulator explained that “it obtained an asset freeze, appointment of a receiver and other relief” against Bkcoin and Kang.
The SEC described that from at least October 2018 to September 2022, Bkcoin raised approximately $100 million from at least 55 investors to invest in crypto assets. “Bkcoin and Kang assured investors that their money would primarily be used to trade cryptoassets and represented that Bkcoin would generate returns for investors through separately managed accounts and five private funds,” the securities regulator said, adding:
The defendants disregarded the structure of the funds, commingled investors’ assets and used more than $3.6 million to make Ponzi-like payments to fund investors.
The complaint alleges that Kang misused at least $371,000 of investor money to pay for vacations, tickets to sporting events and an apartment in New York City, among other things. Further, “Kang attempted to conceal the unauthorized use of investor funds by providing altered documents with inflated bank account balances to the third-party administrator for some of the funds,” the SEC further said.
In addition, Bkcoin allegedly made material misrepresentations to some investors by falsely claiming that either the company or one of its funds had received an audit opinion from a “top four auditor.” However, neither Bkcoin nor any of its funds received an audit opinion at any time.
The securities regulator alleged that Bkcoin and Kang “violated the anti-fraud provisions of the federal securities laws.” The SEC is seeking permanent injunctions against both defendants, as well as disgorgement, prejudgment interest and a civil penalty. In addition, the complaint seeks an officer and director bar and conduct-based injunction against Kang.
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