SEC v. CoinW6, No. LR-26111, Central District of California (Sept. 17, 2024) — Press Release

U.S. SECURITIES AND EXCHANGE COMMISSION Litigation Release No. 26111 / September 17, 2024 Securities and Exchange Commission v. CoinW6, No. 2:24-cv-07924 (C.D. Cal. filed Sept. 17, 2024) SEC Charges CoinW6 with a Relationship Investment Scam Schemers allegedly used WhatsApp, LinkedIn, and Instagram to lure investors to fake crypto asset trading platforms before stealing their money The Securities and Exchange Commission today charged CoinW6 in connection with a romance investment scam - a type of relationship investment scam - involving a fake crypto asset trading platform. The SEC's complaint alleges that the Defendant, doing business as CoinW6.com, 6hsh.com, dmd567.com, bybit.cc, and cglobalw.com, solicited at least 11 investors via social media apps, lied to them to gain their trust and confidence, and then stole their money, which totaled approximately $2.2 million. The SEC's complaint alleges that, from approximately July 2022 to at least December 2023, scheme participants who purported to be young, wealthy professionals contacted prospective investors via LinkedIn and Instagram and pursued romantic relationships over WhatsApp. Scheme participants gained investors' trust and then convinced them to open accounts on CoinW6's supposed crypto asset trading platform. As alleged, the schemers claimed that investors could earn up to a three percent return per day from CoinW6's crypto asset staking, mining, and yield farming products. In reality, investors' funds were misappropriated, and their ostensible investments, profits, and account balances were fictitious. When investors tried to withdraw their purported profits, the schemers allegedly demanded additional payments for taxes or fees, told investors that the crypto assets were frozen as part of a law enforcement inquiry, or tried to blackmail them using compromising romantic communications over WhatsApp. The SEC's complaint, filed in the United States District Court for the Central District of California, charges the Defendant with violating Sections 5(a), 5(c), and 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 SEC seeks permanent injunctions, disgorgement with prejudgment interest, and a civil penalty. The permanent injunctions include a conduct-based injunction and an order requiring CoinW6 to remove all pages of its websites and in its place post a copy of the Commission's complaint. The SEC's investigation was conducted by Matthew B. Reisig and was supervised by Timothy N. England and Melissa Hodgman. The litigation is being conducted by David Nasse and Matthew B. Reisig. The SEC appreciates the assistance of the Monetary Authority of Singapore in this investigation. The SEC's Office of Investor Education and Advocacy, in collaboration with the CFTC's Office of Customer Education and Outreach, FINRA, and NASAA, has issued an Investor Alert about these scams, warning that fraudsters may reach out to investors and slowly build trust before convincing them to "invest" their money and then defrauding them through fake investments. The SEC encourages investors to check the backgrounds of anyone selling or offering them an investment using Investor.gov.

U.S. SECURITIES AND EXCHANGE COMMISSION Litigation Release No. 26111 / September 17, 2024 Securities and Exchange Commission v. CoinW6, No. 2:24-cv-07924 (C.D. Cal. filed Sept. 17, 2024) SEC Charges CoinW6 with a Relationship Investment Scam Schemers allegedly used WhatsApp, LinkedIn, and Instagram to lure investors to fake crypto asset trading platforms before stealing their money The Securities and Exchange Commission today charged CoinW6 in connection with a romance investment scam - a type of relationship investment scam - involving a fake crypto asset trading platform. The SEC's complaint alleges that the Defendant, doing business as CoinW6.com, 6hsh.com, dmd567.com, bybit.cc, and cglobalw.com, solicited at least 11 investors via social media apps, lied to them to gain their trust and confidence, and then stole their money, which totaled approximately $2.2 million. The SEC's complaint alleges that, from approximately July 2022 to at least December 2023, scheme participants who purported to be young, wealthy professionals contacted prospective investors via LinkedIn and Instagram and pursued romantic relationships over WhatsApp. Scheme participants gained investors' trust and then convinced them to open accounts on CoinW6's supposed crypto asset trading platform. As alleged, the schemers claimed that investors could earn up to a three percent return per day from CoinW6's crypto asset staking, mining, and yield farming products. In reality, investors' funds were misappropriated, and their ostensible investments, profits, and account balances were fictitious. When investors tried to withdraw their purported profits, the schemers allegedly demanded additional payments for taxes or fees, told investors that the crypto assets were frozen as part of a law enforcement inquiry, or tried to blackmail them using compromising romantic communications over WhatsApp. The SEC's complaint, filed in the United States District Court for the Central District of California, charges the Defendant with violating Sections 5(a), 5(c), and 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 SEC seeks permanent injunctions, disgorgement with prejudgment interest, and a civil penalty. The permanent injunctions include a conduct-based injunction and an order requiring CoinW6 to remove all pages of its websites and in its place post a copy of the Commission's complaint. The SEC's investigation was conducted by Matthew B. Reisig and was supervised by Timothy N. England and Melissa Hodgman. The litigation is being conducted by David Nasse and Matthew B. Reisig. The SEC appreciates the assistance of the Monetary Authority of Singapore in this investigation. The SEC's Office of Investor Education and Advocacy, in collaboration with the CFTC's Office of Customer Education and Outreach, FINRA, and NASAA, has issued an Investor Alert about these scams, warning that fraudsters may reach out to investors and slowly build trust before convincing them to "invest" their money and then defrauding them through fake investments. The SEC encourages investors to check the backgrounds of anyone selling or offering them an investment using Investor.gov.