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Crypto Hedge Fund Accused of ‘Ponzi-Like’ Funds by SEC

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Crypto Hedge Fund Accused of ‘Ponzi-Like’ Funds by SEC

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(Bloomberg) — Crypto hedge fund BKCoin Administration and Min Woo “Kevin” Kang, one of many agency’s co-founders, are being accused by the US Securities and Alternate Fee of fraud and misusing investor funds.

The SEC stated that Kang and BKCoin, which had allegedly raised almost $100 million from traders, violated securities legal guidelines by making “Ponzi-like” funds. The case was filed in federal courtroom in Miami on Feb. 23 and unsealed Monday.

BKCoin and a lawyer listed by the SEC for Kang didn’t instantly reply to requests for remark. Kang was “suspended” from employment by BKCoin in October, based on the SEC.

Kang was accused by the SEC of spending virtually $400,000 of investor funds on himself, together with about $35,000 to hire a trip home in Montauk, New York. Tens of thousands and thousands of {dollars} of investor funds are at the moment unaccounted for, the SEC stated in its criticism. 

“The defendants misappropriated their cash, created false paperwork, and even engaged in Ponzi-like conduct,” Eric Bustillo, head of the SEC’s Miami workplace, stated in an announcement.

The regulator stated on Monday that it had efficiently obtained an asset freeze and {that a} receiver had been appointed. The investigation is ongoing, the regulator stated. 

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