The SEC has taken immediate legal action against BK Coin Management, an investment advisory firm located in Miami, Florida. Kevin Hang, one of the firm’s principals, is also participating. They are being investigated for allegedly perpetrating a $100 million crypto-related asset fraud scam. In accordance with the documentation submitted, BKCoin amassed almost $100 million between the months of October 2018 and September 2022, thanks to up to 55 investors who wanted to put money into crypto assets. Nonetheless, it is alleged that the corporation used some of the money for both self-use and operations resembling Ponzi payments. The SEC has obtained an order to freeze assets and appointed a receiver.
As per the complaint filed on the 23rd of February 2023, BKCoin and Kevin informed investors of their money being utilized for trading crypto assets and that the entity would be returning the investors’ money through other controlled accounts, along with five private funds. Instead, the defendants happened to have embezzled an amount of over $3.6 million for Ponzi-type payments.
There were also discrepancies involving $371,000 related to investor money used for various personal expenses. To justify all of that, Kevin fudged documents. BKCoin had declared that an audit had been carried out when, in actuality, no such thing had happened. According to Eric I. Bustillo, director of the SEC’s Miami Regional Office, this move appears to prove that the office is keeping its promise to protect investors and combat fraudulent practices.
The court with jurisdiction over this case is the United States District Court for the Southern District of Florida. The SEC is seeking disgorgement, a civil penalty, and permanent injunctions from both defendants in this action. Bison Digital received $12 million from BKCoin, which is also mentioned.
Alexander Charap, Jeffery Golberg, and Julia D’Antonio are all involved in the SEC’s investigation, and they all report to Jessica M. Weissman,Glenn S. Gordon, and Fernando Torres. The SEC’s Retail Strategy Task Force, comprised of representatives from the SEC’s Office of Investor Education and Advocacy and Enforcement, was instrumental in the issuance of both the Investor Alert on Digital Assets and Crypto Investments and the Investor Alert on Pyramid Schemes Posing as Multi-Level Marketing Programs.