The United States Securities and Exchange Commission (SEC) confirmed charges were filed against Jonathan Adam and his brother, Tanner Adam, as part of an effort to thwart an alleged Ponzi scheme worth $60 million. The SEC said it also obtained asset freezes against the pair and their respective entities, GCZ Global LLC and Triten Financial Group LLC.
In the complaint filed in Georgia, the SEC says more than 80 investors were allegedly deceived by a thriving crypto trading bot that never existed. Instead of delivering returns, the Adam brothers used investors’ money to fund a flamboyant lifestyle, the SEC said, which included luxury cars and the construction of a condominium worth $30 million.
The bot was presented as a vehicle for generating monthly returns of 13.5% by taking advantage of arbitrage opportunities across the spectrum of crypto markets, with funds used in a lending pool available for flash loans. However, the SEC has claimed the entire scheme was a fabrication and no such bot existed, with investors only receiving a small fraction of their initial outlay in return.
SEC pursues seizure of Adams brothers’ assets
“As we allege, the Adam brothers promised their investors high returns on a crypto investment that did not exist, and then used investor funds to make Ponzi-like payments and to purchase designer goods, recreational vehicles, and million-dollar homes,” Justin C. Jeffries, Associate Director of Enforcement for the SEC’s Atlanta regional office, said in a statement from the SEC.
“The SEC will use all tools at its disposal to stop those who exploit the excitement around new technologies to defraud investors,” Jeffries added.
The SEC is now seeking to permanently seize all assets, including forfeiture of the acquired funds. Jonathan Adam is alleged to have misled investors regarding his background, including not disclosing his previous three convictions for securities fraud, and ensuring investors of a “virtually nonexistent” element of risk to the project.
Image credit: Via Ideogram
The post SEC charges brothers in alleged $60m crypto Ponzi scheme appeared first on ReadWrite.
