The US Securities and Exchange Commission has charged eight individuals and entities associated with blockchain startup CoinDeal with fraud. They are said to have violated US laws and hatched a scheme to obtain client assets totaling $45 million.
False Claims, Money Laundering, and Wire Fraud
The SEC has charged Neil Chandran, Gary Davidson, Michael Glaspie, Amy Mossell, Linda Knott and others with making false claims about the potential profitability of investing in blockchain technology, CoinDeal. He claimed that customers can use it to gain wealth worth trillions.
seconds claims that from January 2019 to 2022, the eight made false and misleading claims about the value of the company and the activities of various partners. They also allegedly failed to disclose that the company had no plans to distribute any investment income to its investors.
The complaint also claims that the defendants embezzled investors’ funds. For example, Chandran allegedly used investor money to buy a range of items such as cars, real estate and boats.
Daniel Gregus, director of the SEC’s Chicago Regional Office, Said Defendants make false claims about the potential profitability and value of investing in blockchain technology. He also claimed that the company could make a substantial profit by selling this technology over 500,000 times. However, the scheme turned out to be an elaborate scheme involving misappropriation of investor funds.
Chandran was accused of duping over 10,000 users
The US Department of Justice indicted Chandran in June 2022. He was charged in the District Court of Nebraska with three counts of wire fraud and two counts of illegal money transactions, defrauding more than 10,000 unsuspecting 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 observers. The case is led by Michael Foster from the Chicago office.
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