The Securities and Exchange Commission (SEC) has brought forward charges against Lottery.com, Inc. (Lottery.com) and former senior figures for alleged breaches of financial fraud regulations.
Those charged include Lawrence Anthony DiMatteo, a former CEO of Lottery.com and former company executives Matthew Clemenson and Ryan Dickinson.
Another individual highlighted by the SEC investigation is Vadim Komissarov, CEO of a Special Purpose Acquisition Company (SPAC), Trident Acquisitions Corp.
SEC cracks down on Lottery.com
The SEC case was brought in the U.S. District Court for the Southern District of New York, and the regulator published a brief missive outlining the allegations.
According to the complaint, Komissarov is alleged to have “planned and executed a revenue scam” with DiMatteo, Clemenson, and Dickinson, which allegedly violated Section 17(a) of the Securities Act of 1933 and Sections 10(b) and 14(a) of the Exchange Act of 1934, along with related SEC rules.
Customer data was central to the scam charges and involved what the regulator calls “useless customer data” that was then cycled through a number of multi-million-dollar transactions.
The initial fraud complaint points a finger at a “revenue scam in which Lottery purportedly received $9 million for valueless customer data, booked it as revenue, and then used that $9 million to overpay for two Mexican businesses and, thus, return the $9 million to its source.”
The second alleged revenue scam involved “a bogus $30 million sale of advertising credits, and, following the merger, executed two additional bogus sales totaling over $35 million,” said the legal case.
The $9 million and $35 million transactions, says the SEC, were processed by international companies and had no commercial or legitimate value before and after Trident Acquisitions Corp moved in to complete the merger deal.
Charges brought against the former Lottery leaders
DiMatteo, Clemenson, and Dickinson have been formally charged with aiding and abetting Lottery.com’s reporting and controls violations that resulted in damage to the company’s value, misrepresented investors, and led to irreparable company damages.
All three have also been accused of falsifying and altering financial records for personal gain under Section 13(b)(5) of the SEC’s regulations.
Clemenson and Dickinson have consented to the SEC’s proposed judgments, without admitting or denying the allegations, agreeing to permanent injunctions, civil penalties, and officer-and-director bars, subject to court approval.
Komissarov and DiMatteo’s cases remain ongoing. The SEC is seeking permanent injunctions, disgorgement with prejudgment interest, civil penalties, and officer-and-director bars, with no trial date yet set.
Featured image: Lottery.com/SEGG Media
