CoinDeal scam orchestrators face charges over a $45m fraud

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Regulation
CoinDeal scam orchestrators face charges over a $45m fraud

The US Securities and Exchange Commission has charged eight individuals and entities associated with the blockchain startup CoinDeal with fraud. They are said to have violated US laws and orchestrated a scheme to obtain client assets totaling $45 million.

False claims, funds misappropriation, and wire fraud

The SEC has accused Neil Chandran, Garry Davidson, Michael Glaspie, Amy Mossel, Linda Knott, and others of making false claims about the potential profitability of investing in blockchain technology, CoinDeal. They claimed the customers could use it to acquire trillions of assets.

The SEC claims that from around January 2019 through 2022, the eight made false and misleading claims about the company’s value and various partners’ activities. They also allegedly failed to disclose that the company had no plans to distribute any investment proceeds to its investors.

The complaint also claims that the defendants misappropriated the funds of investors. For instance, Chandran allegedly used investor funds to purchase multiple items, such as cars, real estate and boats.

Daniel Gregus, the director of the SEC’s Chicago regional office, said that the defendants made false claims about the potential profitability and value of investing in blockchain technology. They also claimed that the company could generate substantial returns by selling the technology more than 500,000 times. However, the scheme was an elaborate scheme that involved the misappropriation of investor funds.

Chandran was charged with defrauding more than 10,000 users

The US Department of Justice indicted Chandran in June 2022. He was charged with three counts of wire fraud and two unlawful money transactions in the District Court of Nebraska, defrauding more than 10,000 unknowing people.

The investigation is handled by Dante Roldan, Steven Trombino, Caryn Trombino from the Chicago regional office, and Paul Montoya and Ana D. Petrovic from the Florida office as supervisors. The case is being led by Michael Foster, also from the Chicago office.

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Samuel Mbaki Wanjiku

Samuel is an adventurous person who likes to explore topics in-depth and learn new things each day. His passion lies in gaining knowledge to help transform the world through his writing skills. He also believes in blockchain technology and its potential to usher in a cashless society. Currently, he is pursuing a Computer Science Bachelor’s degree driven by his fascination with emerging technologies. He has writing experience of about three years in different fields and two in blockchain technology.