SEC, DOJ Charge Individuals in $1.9 Billion Hyperfund Cryptocurrency Fraud
Publikováno: 31.1.2024
The SEC alongside the DOJ, has levied serious charges against key figures in a $1.9 billion cryptocurrency fraud scheme involving Hyperfund. SEC and DOJ Crack Down on $1.9 Billion Hyperfund Crypto Fraud The U.S. Securities and Exchange Commission (SEC) and the Department of Justice (DOJ) have taken major legal action against individuals involved in a […]
The SEC alongside the DOJ, has levied serious charges against key figures in a $1.9 billion cryptocurrency fraud scheme involving Hyperfund.
SEC and DOJ Crack Down on $1.9 Billion Hyperfund Crypto Fraud
The U.S. Securities and Exchange Commission (SEC) and the Department of Justice (DOJ) have taken major legal action against individuals involved in a massive $1.9 billion cryptocurrency fraud, encompassing a wide-reaching scheme known as Hyperfund, also referred to as Hyperverse, Hypertech, and Hypercapital.
The DOJ announced criminal charges against two key figures and the guilty plea of a third in what is being described as a global Ponzi scheme. Australian citizen Sam Lee, residing in Dubai, and promoters Rodney Burton of Miami and Brenda Chunga of Severna Park, Maryland, face charges related to the scheme.
Lee, 35, known as Xue Lee, is charged with conspiracy to commit securities fraud and wire fraud. Burton, 54, also known as “Bitcoin Rodney,” faces charges for operating an unlicensed money-transmitting business. Chunga, also known as Bitcoin Beautee, has pleaded guilty to conspiracy charges and has agreed to settle civil charges by the SEC.
The SEC’s civil action mirrors these allegations, focusing on the fraudulent nature of the Hyperfund scheme, which collapsed in 2022. Investors were promised substantial returns from nonexistent cryptocurrency mining operations.
The scheme, operational from June 2020 through November 2022, enticed investors with daily returns of 0.5% to 1%, purportedly through large-scale crypto mining. However, by July 2021, Hyperfund began blocking investor withdrawals.
Hyperfund reportedly had a fake CEO and amassed nearly $2 billion fraudulently. The SEC alleges that the operation had no legitimate revenue source, using new investor deposits to pay earlier investors, a classic hallmark of a Ponzi scheme.
Lee and Chunga are accused of using investor funds for lavish personal expenses. Chunga’s alleged expenditures include designer clothing, luxury cars, and properties in Maryland and Dubai. Lee is said to have transferred $140,000 in digital funds to a wallet under his control.
Are you satisfied with the government’s response to crypto-based frauds like Hyperverse? Share your thoughts and opinions about this subject in the comments section below.