Court Enters Final Judgment Against Fraudulent Crypto Assets Website Operator
The U.S. District Court for the District of Massachusetts entered a final judgment against GA Investors, the operator of dozens of fraudulent websites, including GA-Investors.org. Among other things, the judgment ordered the defendant to pay over $1.1 million.
The May 2023 U.S. Securities and Exchange Commission complaint alleged that GA Investors and its unknown owners fraudulently offered exorbitant returns, in some cases as high as 61.9% in 24 hours, for investments in various securities. Some of the websites also impersonated legitimate companies.
As alleged in the complaint, investors across the world, including investors in the United States, invested approximately $85,000 in the fraudulent securities offering on the GA-Investors.org website. The GA Investors website offered guaranteed daily returns ranging from 2% to 4.5%.
Investors were directed to purchase crypto assets from a separate crypto asset trading platform and transfer those crypto assets to a GA Investors wallet address. Although some investors were able to make small withdrawals from their accounts, when the investors sought to recoup larger portions of their investments, the defendants froze investor accounts and misappropriated the investor funds.
The final judgment, which was entered by default, enjoins GA Investors from future violations of the antifraud provisions of Section 17(a) of the Securities Act of 1933 and Section 10(b) of the Securities Exchange Act of 1934 and Rule 10b-5 thereunder. The judgment also bars GA Investors from participating in future offerings of securities. In addition, the judgment orders GA Investors to pay disgorgement of just over $70,000, plus prejudgment interest of $5,740, and a civil penalty of just over $1.1 million.
The SEC’s litigation in this matter is now concluded.
The SEC’s Office of Investor Education and Advocacy has issued investor alerts warning investors about fraudulent crypto trading websites and crypto investment scams. Additionally, OIEA and the FBI jointly warned investors about those who falsely claim to be registered – or who impersonate registered investment professionals – to lure investors into scams.
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