SEC, FBI, DOJ coordinate to take down 4 fraudulent crypto firms
Three so-called market makers in the crypto space, along with related individuals, have been indicted by the United States Securities and Exchange Commission (SEC) in a Massachusetts district court on civil charges of fraud and market manipulation. The Department of Justice and the Federal Bureau of Investigation (FBI) were also involved in the investigation.
The charges were filed on October 9 against Gotbit Consulting, ZM Quant Investment and CLS Global. In addition, two charges have been filed against individuals related to the case. A total of nine individuals were charged, the SEC said.
A sophisticated web of violations
Gotbit Consulting and its marketing director, Fedor Kedrov, were accused of market manipulation on behalf of individuals promoting cryptocurrencies called Saitama and RoboInu. Washing business is the practice of self-marketing to create market demand.
Those crypto projects were organized by Vy Pham, a Vietnamese national living in California. She is charged separately with unregistered securities offerings, fraudulent offer or sale of securities, fraudulent purchase or sale of securities and market manipulation.
Four people associated with Pam have been indicted on similar charges. Pham and two of her co-conspirators agreed to two-payment settlements, allowing the charges against them to be resolved separately.
The other two firms, ZM Quant Investment and CLS Global, expect similar fees in connection with a coin called NexFundAI. That cryptocurrency was created by the FBI. In addition, ZM Quant and four individuals associated with Fam have been indicted for another crypto asset, the cryptocurrency coin.
Some of the services offered by Gotbit. Source: Gotbit
A long search for justice
Khedrov is believed to be living in Russia. The ZM Quant executives named in that suit reside in London, England and Hong Kong. One of the four accused in the fifth case lives in India. even if –
“The complaints seek permanent injunctions, conduct-based orders, disgorgement of ill-gotten gains and interest, and civil penalties against all defendants, as well as executive and director injunctions against certain defendants.”
In a separate statement, the FBI listed additional cryptocurrencies under investigation including Total Saitama, Citarealty, SaiChain, RoboInu, VZZN, Lillian Finance and NexFundAI.
Source: Exotic Whales
The Justice Department lists a total of 18 people suing and one additional company: MyTrade MM, which provided services to NexFundAI.
According to the Department of Justice, the founders of VZZN and Lilian Finance Coins were also charged. The founder of VZZN had ties to Saitama, but that's all the two coins have to do with the rest of the investigation.
Magazine: What do crypto market makers do? Liquidity, or fraud
