SEC charges three people for impersonating securities brokers in $2.9 million Bitcoin-related scam

The U.S. SEC charged three Nigerian nationals on December 11 for impersonating securities brokers and investment advisers in a digital asset fraud scheme that diverted over $2.9 million from at least 28 investors. The defendants allegedly:

• Created fake websites and used AI tools like voice-modification software and deepfake content to impersonate legitimate investment professionals.
• Directed victims to buy Bitcoin on reputable platforms and transfer funds to their blockchain addresses.
• Showed fake account gains via fraudulent interfaces to lure additional investments but never actually invested the funds.
• Demanded further fees when victims attempted to withdraw their funds.

The SEC’s complaint highlights the increasing sophistication of crypto-related impersonation scams, often using encrypted messaging apps, spoofed phone numbers, and blockchain technology to evade detection.

The SEC and the U.S. Attorney’s Office for New Jersey are pursuing charges for securities law violations, seeking penalties, injunctions, and recovery of funds.

The SEC and FBI issued an investor alert advising heightened caution, identity verification through public records, and skepticism toward unverified trading apps or requests for crypto transfers. The case underscores the need for vigilance as fraudsters exploit crypto markets with advanced technologies.