SEC v. Geosyn Mining, LLC; Caleb Joseph Ward; and Jeremy George McNutt, No. 4:24-cv-00365, Northern District of Texas (Apr. 24, 2024) — Complaint

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UNITED STATES DISTRICT COURT
NORTHERN DISTRICT OF TEXAS
FORT WORTH DIVISION

SECURITIES AND EXCHANGE
COMMISSION,

          Plaintiff,
 Cause No.
v.

GEOSYN MINING, LLC, CALEB JOSEPH
WARD, and JEREMY GEORGE MCNUTT,

          Defendants.

COMPLAINT

Plaintiff Securities and Exchange Commission (“SEC”) files this Complaint against
Geosyn Mining, LLC (“Geosyn”), Caleb Joseph Ward (“Ward”), and Jeremy George McNutt
(“McNutt”) (together, “Defendants”) and alleges as follows:
SUMMARY OF THE ACTION

1. Between November 2021 and December 2022, Defendants engaged in an
unregistered and fraudulent securities offering through Geosyn, a crypto asset mining and
hosting company founded and controlled by Ward and McNutt.  Together, Defendants raised
over $5.6 million from approximately 64 investors through the sale of investment contracts
called “Client Services Agreements” (“CSAs”).  Under the terms of the CSAs, Geosyn claimed it
would purchase, maintain, and operate crypto asset mining machines and then distribute the
mined crypto assets, such as bitcoin, to the investors for a fee.
2. However, while soliciting investors, Defendants: (a) falsely claimed that Geosyn
had favorable contracts with electricity providers which enabled Geosyn to operate the crypto
asset mining machines profitably; (b) failed to disclose to new investors that they never

4:24-cv-00365

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purchased mining machines (or brought mining machines online) for some of the previous
investors; and (c) failed to disclose that Geosyn was not providing the services that it claimed in
its offering documents, such as allowing investors to personalize their crypto mining strategy or
providing 24/7 onsite monitoring of the mining machines.  Further, of the investor funds raised,
Ward and McNutt misappropriated approximately $1.2 million for personal use and paid
approximately $354,500 to investors in purported mined bitcoin distributions, while admitting in
messages to each other that they needed to buy bitcoin to fully fund distributions.
3. By reason of this misconduct, the Defendants violated, and unless enjoined will
continue to violate, the antifraud and registration provisions of the federal securities laws.  In the
interest of protecting the public from further violations, the SEC brings this action seeking
permanent injunctive relief, disgorgement of ill-gotten gains plus prejudgment interest, civil
penalties and all other equitable and ancillary relief the Court deems necessary and proper.
JURISDICTION AND VENUE

4. This Court has jurisdiction over this action pursuant to Sections 20(b), 20(d), and
22(a) of the Securities Act of 1933 (“Securities Act”) [15 U.S.C. §§ 77t(b), 77t(d), and 77v(a)]
and Sections 21(d), 21(e), and 27(a) of the Securities Exchange Act of 1934 (“Exchange Act”)
[15 U.S.C. §§ 78u(d), 78u(e), and 78aa(a)].  This action involves the offer and sale of investment
contracts, which are specifically identified in the definitions of “security” under Section 2(a)(1)
of the Securities Act and Section 3(a)(10) of the Exchange Act.  The Defendants directly or
indirectly made use of the means or instrumentalities of interstate commerce or the mails in
connection with the transactions, acts, practices, and courses of business alleged herein.
5. Venue is proper in this district pursuant to Section 22(a) of the Securities Act [15
U.S.C. § 77v(a)] and Section 27(a) of the Exchange Act [15 U.S.C. § 78aa(a)].  Certain of the
transactions, acts, practices, and courses of business constituting violations of the federal

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securities laws occurred within this district.  Further, at the time of the violations alleged in this
matter, Geosyn had its principal place of business in this district, and both Ward and McNutt
resided in this district.
DEFENDANTS

6. Geosyn is a Texas limited liability company offering crypto asset mining and
hosting services.  Ward and McNutt formed Geosyn in August 2021 in Fort Worth, Texas.
Geosyntek Holdings, Inc. (“Geosyntek”) is the parent entity and managing member of Geosyn.
Neither Geosyn nor its securities are registered with the Commission.
7. Ward, age 40, previously resided in Fort Worth, Texas, but relocated to Smyrna,
Georgia in or around 2023.  During all relevant periods, Ward was the president, Chief Executive
Officer (“CEO”), and co-founder of Geosyn.  During the Commission’s underlying investigation,
Ward asserted his Fifth Amendment privilege against self-incrimination and refused to testify.
8. McNutt, age 35, resides in Weatherford, Texas.  McNutt co-founded Geosyn and
served as its Chief Operating Officer (“COO”) from January 2022 to October 2022, when he
resigned.
FACTUAL ALLEGATIONS

A. Background

1. Crypto Assets and Mining Technology

9. As used herein, the term “crypto asset” generally refers to an asset issued and/or
transferred using blockchain or distributed ledger technology, including assets referred to
colloquially as “cryptocurrencies,” “virtual currencies,” and digital “coins.”
10. A blockchain or distributed ledger is a database spread across a network of
computers that records transactions in theoretically unchangeable, digitally recorded data
packages, referred to as “blocks.”  These systems typically rely on cryptographic techniques to

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secure recording of transactions.
11. The capitalized term “Bitcoin” refers to the public ledger which supports Bitcoin
blockchain technology; lower-case “bitcoin” refers to the crypto assets created by and
electronically stored in the Bitcoin blockchain.
12. Blockchains typically employ a “consensus mechanism” that, among other things,
aims to achieve agreement among users as to which ledger transactions are valid, when and how
to update the blockchain, and whether to compensate or “reward” certain participants for
validating transactions and adding new blocks.
13. One prevalent consensus mechanism, called “proof of work” and used by
protocols such as Bitcoin, involves a network of computers expending computational effort to
guess the value of a predetermined number.  The first computer to successfully guess this
number earns the right to update the blockchain with a block of transactions and is rewarded or
compensated with the blockchain’s native crypto asset.  The compensation can come from fees
paid by those transacting on the blockchain as well as through newly created amounts of the
blockchain’s native crypto asset.  Participants who undertake validating activities are known as
“miners.”
14. Typically, proof of work miners are more likely to earn rewards when they run
large “farms” of mining equipment with little or no downtime.  This, coupled with the
computationally intensive proof of work consensus mechanism, requires a great amount of
electricity.  Lower operational costs, such as lower electricity costs, result in increased profit
margins.
15. “Hosting” generally refers to a third party’s provision of facilities and
infrastructure to house,  maintain and operate crypto asset mining machines on behalf of other
miners.

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2. Geosyn’s Founding

15. Ward and McNutt met sometime around 2017 or 2018.  At the time, Ward ran an
oil-and-gas mineral rights business and hired McNutt as an acquisition agent.  The two worked
together in this capacity until 2020, when they began exploring alternative business
opportunities.
16. In mid-to-late 2021, Ward and McNutt founded Geosyn with the purported aim to
offer investors the ability to profit from bitcoin mining by outsourcing to Geosyn the technical
expertise, crypto asset miner procurement, and management of a complex crypto asset mining
system.
17. Ward and McNutt held the titles of CEO and COO, respectively.  While their
roles overlapped, Ward was more heavily involved in investor solicitation, and McNutt managed
Geosyn’s day-to-day operations.
18. Geosyn rented two commercial spaces to operate its business and to house the
crypto asset mining machines that it was purportedly going to purchase, maintain, and operate
for investors.  The first facility was located in downtown Fort Worth, Texas (the “Magnolia
Location”), and the second facility was located in a rural area northwest of Fort Worth (the
“Springtown Location”).  At its height in 2022, Geosyn had approximately 12 employees.
3. Soliciting Investors
19. Geosyn obtained the majority of its investors through word-of-mouth.  Most
investors were individuals, and not all were accredited.  Although Ward primarily led the
solicitation efforts, McNutt and other Geosyn employees also directly solicited investors.
20. Geosyn conducted a general solicitation of investors through its website
(https://geosynmining.com/) and social media accounts.  Ward, McNutt, and Geosyn employees
working under the Defendants’ directions set up and managed social media accounts for Geosyn

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on Twitter, Telegram, Facebook, LinkedIn, and Reddit and used those accounts to advertise their
mining business, to showcase their participation at crypto asset conferences, to disseminate
facility development photos and progress updates, and to share crypto asset industry news.
Geosyn also created a YouTube channel, on which it posted informational videos about crypto
asset mining.  Ward led the marketing efforts, including co-managing the Geosyn website and
overseeing Geosyn’s “marketing department” employees.
21. In total, from at least November 2021 through December 2022, Geosyn raised
approximately $5.6 million from approximately 64 investors in 18 states and three foreign
countries.
4.  Offering Documents
22. Defendants provided investors with the following documents: (1) an investment
contract that Geosyn called a CSA; and (2) an Excel file, which showed projected investment
returns for the various mining machines that relied heavily on speculative increases in the value
of bitcoin (“ROI Projections”).  At least some investors also received a one-page document
summarizing the investment (“Summary Page”) and an investment deck with a flow chart
identifying the steps from an initial investment with Geosyn to the investor receiving profits in a
crypto asset wallet (“Flow Chart”).  Ward and McNutt collectively authored the CSA and
Summary Page, and Ward was the sole creator of the ROI Projections.
23. When signing the CSAs, Geosyn’s investors specified the number and model of
mining machines that they wanted Geosyn to purchase on their behalf and agreed to pay Geosyn
a 15% “procurement fee” above the cost of the mining machines.  In exchange for the
investment, Geosyn agreed to purchase and run crypto asset mining machines on the investors’
behalf and to pay investors a return of profits in the form of monthly crypto asset distributions,
minus deductions for Geosyn’s 7% hosting fee, mining pool fees, and electricity charges.  For

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investors who did not provide separate crypto asset wallet addresses, Geosyn also provided
electronic tablets with crypto asset wallets already installed to receive mining distributions.
B. The Defendants’ Misrepresentations and False Statements
24. Through Geosyn’s offering documents, Defendants claimed they would provide
competitive crypto asset miner hosting services through expertise and economies of scale, such as
connecting their machines to crypto asset mining pool networks to increase their chances of earning
mining rewards.  However, almost everything that Defendants represented about Geosyn’s miner
purchases and operations contained some element of falsity, as discussed below.
1. False Statements About Electricity Contracts
25. Profit margins in the crypto asset mining industry center on maintaining low
energy costs.  Consistent with this market reality, Ward and other Geosyn representatives falsely
represented, through the ROI Spreadsheet and in some instances through statements made
directly to investors in conversations, emails, and text messages, that Geosyn had obtained
commercial electricity contracts at $0.045 to $0.048 per kilowatt hour (“kWh”).  Similarly, the
Summary Page claimed that Geosyn’s investors benefitted from “wholesale power pricing,
which makes mining bitcoin more profitable.”  Geosyn’s low electricity cost was material to
investors.
26. In reality, Geosyn’s actual electricity costs did not benefit from “wholesale power
pricing” and, at times, more than doubled the represented rates.  At the Magnolia Location,
Geosyn’s landlord paid the building’s entire electricity costs and billed Geosyn for its pro-rata
share.  Between February and November 2022, Geosyn’s electricity costs at the Magnolia
Location ranged as high as 40-50% above the $0.045/kWh purported cost represented to
investors.  Despite this knowledge, Ward and McNutt continued to provide the Summary Page
and ROI Projections when soliciting new investors.

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27. At the Springtown Location, Defendants fared even worse.  On behalf of Geosyn,
McNutt’s mother signed a one-year contract with an electricity provider in April 2022 for a fixed
base rate of $0.084743/kWh which, with delivery charges, was more than double the cost that
Geosyn continued to represent to investors.  Two days before McNutt’s mother signed the
electricity contract, McNutt and Ward exchanged text messages acknowledging that the actual
electricity rates were well above the $0.045/kWh rate represented to investors.  In those
messages, Ward discussed the idea of raising the electricity cost in the model projection that he
provided to investors to $0.065/kWh.  But neither Ward nor anyone else at Geosyn ever changed
the model projection or stopped citing the false $0.045/kWh rate.
28.  In particular, Geosyn falsely told investors that, as a result of its supposed low-
cost electricity contracts,  it could make a profit so long as the price of bitcoin remained in the
$9,000–$15,000 range.  Yet, even though the price of bitcoin has not fallen below $16,000 since
2020, Geosyn was unable to make a profit because it did not have the favorable electricity
contracts that Defendants touted to investors.
2.   False Statements to Investors about Miner Purchases and Operations
29. Defendants lied to investors about how Geosyn would operate the mining
machines.  In the Flow Chart, Geosyn represented to investors that it would purchase, set up, and
begin to run mining machines within three to four weeks of an investor executing a CSA.
Similarly, the Geosyn website stated that machines would generally come online within six
weeks of investment.  Once the mining machines were online, Geosyn’s CSA and website also
promised investors 98% guaranteed run time and that Geosyn would provide necessary
maintenance and 24/7 site monitoring and security for the mining machines.  In the Summary
Page, Geosyn also represented that investors could personalize their mining strategies by
selecting which specific crypto assets to mine.

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30. On March 15, 2022, Geosyn issued a press release in which Ward is quoted as
falsely stating that, within its first month of operation, the Magnolia Location was at “full
capacity,” prompting Geosyn to open the Springtown location to host additional mining
machines.
31. Out of the approximately 1,400 machines that Geosyn entered CSAs to purchase,
Geosyn, as Ward and McNutt knew, failed to purchase about 400 mining machines and never
brought most of the purchased mining machines online.
32. As for the mining machines that it did procure and turn on, Geosyn did not allow
investors to personalize their mining strategies.  Instead, Geosyn rejected investor requests to
mine any crypto asset other than bitcoin.
33. Geosyn also did not provide adequate security, and experienced two break-ins at
the Springtown Location.
 3.  False Statements about Profitability and Lulling Payments
34. Ward continued to solicit additional investments through periodic emails, though
none of the investors ultimately decided to invest additional funds beyond their initial investment
amounts.
35. To make investors believe that their mining machines were operational and
profitable when they were not, Geosyn made periodic bitcoin distributions to investors at least as
late as February 2023.  Geosyn also publicized distribution payments in its March 15, 2022 press
release, touting that Geosyn made its first bitcoin distribution to investors on February 22, 2022.
36. In total, Geosyn only collected approximately $320,000 from bitcoin mining.  But
Geosyn distributed approximately $354,500 in bitcoin to investors (this number does not take
into account Ward’s and McNutt’s other misappropriations, as discussed below).  To make up
for the shortfall, in part, Geosyn distributed to its investors bitcoin that McNutt purchased and

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sent to Ward.  In text messages exchanged in June and July 2022, McNutt and Ward expressly
discussed their scheme to purchase bitcoin to fund investor distributions.
37. Geosyn also distributed bogus documents to investors to create the appearance of
profitability.  Ward prepared and sent investors monthly distribution statements showing
fabricated mining production rates and profits for Geosyn and for the clients’ purported shares of
the production.  The monthly reports included fabricated deductions for: (a) electricity costs,
calculated at the understated $0.045/kWh rate; (b) mining pool fees; and (c) Geosyn’s 7%
hosting fee.
C. Defendants Misappropriated Investor Funds.

38. Defendants directed investors to send money to Geosyn’s bank accounts to
purchase their investment contracts.  Investors wired their funds or mailed checks, which were
deposited into Geosyn’s accounts.    In a few instances, investors paid with bitcoin transfers.
Because Ward and McNutt controlled Geosyn’s operations and its bank accounts, they were able
to move investor funds as they wished.  Ward and McNutt both had access to and control of the
Geosyn company credit card, which was paid from Geosyn bank accounts.
39. Ward misappropriated approximately $402,455.35 from Geosyn in the form of
cash withdrawals, bank transfers, and company credit card charges.  Ward used the investor
funds for a variety of personal expenses and items, including meals and entertainment, business
expenses unrelated to Geosyn, and other items.
40. McNutt misappropriated approximately $862,095.13 from Geosyn in the form of
cash withdrawals, bank transfers, and company credit card charges.  McNutt used the investor
funds for a variety of personal expenses and items, including vacation travel, construction
materials, personal legal fees, firearms, wrist watches, and other items.
41. The offering documents did not authorize Ward or McNutt to use investor funds

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for personal use, and the Defendants did not disclose that any investor funds would be used for
Ward’s and McNutt’s personal benefit.  To the contrary, under the terms of the offering
documents, investor funds were to be used to purchase crypto asset mining machines, and an
additional 15% fee was added for Geosyn’s operations.  The statements in the offering
documents about how the Defendants intended to use investor funds were false and misleading.
42. To maintain a façade of success, Ward and McNutt attended several crypto asset-
technology conferences in 2022 and spent tens of thousands of dollars on flights for themselves
and Geosyn employees, luxury accommodations, nightclubs, and other entertainment venues.
43. At Ward’s direction, McNutt charged approximately $20,000 to his Geosyn credit
card to pay for Ward’s Las Vegas nightclub wedding celebration.  Additionally, from June to
August 2022, McNutt charged approximately $49,000 on his Geosyn credit card in connection
with a family trip to Disney World.  The charges included payments for Disney World tickets,
Disney World vendors, an Airbnb rental, and airfare.  Finally, as Geosyn’s operations ground to
a halt in 2023, Ward liquidated the Geosyn crypto asset wallet, and kept about $57,000 for
himself.
44. At one crypto asset conference in June 2022, McNutt was involved in a car
accident, and he and another Geosyn employee were separately arrested for drunk driving
(“DUIs”).  Subsequently, Ward and McNutt authorized Geosyn to use investor funds to pay
approximately $22,000 for a breathalyzer device and for other expenses related to the DUIs and
consequent criminal charges.
D. The Unraveling of the Geosyn Scheme
45. In late 2022, Defendants’ scheme began to unravel as new investor funds dried
up.  Geosyn received its last new-investor funds by December 2022.
46. With no new investor funds to finance Geosyn’s operations, Ward blamed

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McNutt for the failing business.  Around October 2022, Ward accused McNutt of embezzling
from Geosyn, and on October 7, 2022, McNutt signed a release agreement under which he
agreed to surrender his ownership interest in Geosyn and its affiliates.
47. In December 2022, Ward voluntarily contacted criminal authorities to report that
McNutt had embezzled funds from Geosyn without disclosing his own misappropriations.
48. The week before Christmas 2022, Ward terminated all but two Geosyn
employees, retaining his personal assistant and another employee who assisted with operating the
mining machines.  Having failed to pay electricity costs, Ward was forced to abandon the
Magnolia Location and to move all of Geosyn’s operations to the Springtown Location.
According to Geosyn’s bank records, on December 27, 2022, Geosyn had a balance of only
approximately $1,874.
49. Despite Geosyn’s dire financial straits, Ward continued some form of operations
into 2023.  Around the start of 2023, Ward began emailing investors “IOUs,” noting that the
investors were owed bitcoin distributions that Geosyn would pay later.  Ward also sent emails to
investors claiming that there were operational hiccups due to “malfeasance,” difficulties
procuring electricity, and struggles with upgrading power systems.  As Geosyn’s prospects of
recruiting new investors dwindled, Ward frantically sought outside funds to keep Geosyn
operating.
50. While Geosyn was faltering, several investors demanded to take possession of the
mining machines they purchased through Geosyn.  One such investor (“Investor A”) had
contracted with Geosyn for the purchase of 90 mining machines.  Geosyn never purchased those
mining machines, and instead sent Investor A mining machines that belonged to an unrelated
investor.  When Investor A arranged to pick up 51 additional mining machines from the
Springtown Location that he had previously procured himself and contracted with Geosyn to

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host, he discovered that the 51 mining machines were still in their original packaging.
51. On May 25, 2023, the Springtown Location’s landlord locked-out Ward and
Geosyn due to non-payment of rent.
52. On June 1, 2023, Ward emailed the investors to state that Geosyn would file for
bankruptcy, an event that never transpired.
FIRST CLAIM FOR RELIEF
Geosyn, Ward, and McNutt violated Section 10(b) of the Exchange Act [15 U.S.C. § 78j(b)]
and Rule 10b-5 thereunder [17 C.F.R. § 240.10b-5]

53. The SEC re-alleges and incorporates by reference each and every allegation
contained in the paragraphs above.
54. By engaging in the conduct described herein, each Defendant, directly or
indirectly, singly or in concert, by the use of the means or instrumentalities of interstate
commerce and/or by use of the mails, in connection with the purchase or sale of securities, has:
(a) employed a device, scheme, or artifice to defraud; and/or (b) made an untrue statement of a
material fact, or omitted to state a material fact necessary in order to make the statements made,
in light of the circumstances under which they were made, not misleading; and/or (c) engaged in
an act, practice, or course of business which operated or would operate as a fraud or deceit upon
purchasers, prospective purchasers, and any other persons.
55. Each Defendant acted with scienter and engaged in the referenced acts knowingly
and/or with severe recklessness.
56. By reason of the foregoing, each Defendant has violated, and unless enjoined will
continue to violate, Section 10(b) of the Exchange Act [15 U.S.C. § 78j(b)] and Rule 10b-5
thereunder [17 C.F.R. § 240.10b-5].

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SECOND CLAIM FOR RELIEF
Geosyn, Ward, and McNutt violated Section 17(a) of the Securities Act [15 U.S.C. § 77q(a)]

57. The SEC re-alleges and incorporates by reference each and every allegation
contained in the paragraphs above.
58. By engaging in the conduct described herein, each Defendant, directly or
indirectly, singly or in concert with others, in the offer or sale of securities, by use of the means
or instruments of transportation or communication in interstate commerce and/or by use of the
mails, has: (a) employed a device, scheme, or artifice to defraud; and/or (b) obtained money or
property by means of an untrue statement of a material fact or an omission to state a material fact
necessary in order to make the statements made, in light of the circumstances under which they
were made, not misleading; and/or (c) engaged in a transaction, practice, or course of business
which operated or would operate as a fraud or deceit upon the purchaser.
59. With regard to the Defendants’ violations of Section 17(a)(1) of the Securities
Act, the Defendants acted with scienter and engaged in the referenced acts knowingly and/or
with severe recklessness.  With regard to the Defendants’ violations of Sections 17(a)(2) and
17(a)(3) of the Securities Act, the Defendants acted at least negligently.
60. By reason of the foregoing, each Defendant has violated, and unless enjoined will
continue to violate, Section 17(a) of the Securities Act [15 U.S.C. § 77q].
THIRD CLAIM FOR RELIEF
Geosyn, Ward, and McNutt violated Sections 5(a) and 5(c) of the Securities Act [15 U.S.C.
§§ 77e(a) & (c)

61. The SEC re-alleges and incorporates by reference each and every allegation
contained in the paragraphs above.
62. By engaging in the conduct described above, each Defendant, directly or

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indirectly, singly and in concert with others, has: (a) made use of the means or instruments of
transportation or communication in interstate commerce or of the mails to sell, through the use or
medium of any prospectus or otherwise, securities as to which no registration statement was in
effect; and/or (b) for the purpose of sale or delivery after sale, carried or caused to be carried
through the mails or in interstate commerce, by the means or instruments of transportation,
securities as to which no registration statement was in effect; and/or (c) made use of the means or
instruments of transportation or communication in interstate commerce or of the mails to offer to
sell, through the use or medium of any prospectus or otherwise, securities as to which no
registration statement has been filed.
63. By reason of the foregoing, each Defendant violated, and unless enjoined will
continue to violate, Sections 5(a) and 5(c) of the Securities Act [15 U.S.C. §§ 77e(a) and
77(e)(c)].
RELIEF REQUESTED

Therefore, the SEC respectfully requests that this Court:

(a) Permanently enjoin each Defendant from violating, directly or
indirectly, Sections 5(a), 5(c), and 17(a) of the Securities Act [15 U.S.C. §§ 77e(a), 77e(c)
and 77q(a)] and Section 10(b) of the Exchange Act [15 U.S.C. § 78j(b)] and Rule 10b-5
thereunder [17 C.F.R. § 240.10b-5];
(b) Permanently restrain and enjoin Ward and McNutt from
 participating,
directly or indirectly, including, but not limited to, through any entity controlled by either of
them, in any offering of securities, including any crypto asset security; provided, however,
that such injunctions shall not prevent them from purchasing or selling securities, including
any crypto asset security, for their own personal accounts;
(c) Permanently bar Ward and McNutt from serving as an officer or

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director of any issuer that has a class of securities registered pursuant to Section 12 of the
Exchange Act [15 U.S.C. § 78l] or that is required to file reports pursuant to Section 15(d)
of the Exchange Act [15 U.S.C. § 78o(d)];
(d) Order Ward and McNutt to each disgorge his ill-gotten gains, plus
prejudgment interest on those amounts, pursuant to Exchange Act Sections 21(d)(3),
21(d)(5), and 21(d)(7) [15 U.S.C. §§ 78u(d)(3), 78u(d)(5), and 78u(d)(7)];
(e) Order Ward and McNutt to each pay a civil penalty pursuant to
Section 20(d) of the Securities Act [15 U.S.C. § 77t(d)] and/or Section 21(d)(3) of the
Exchange Act [15 U.S.C. § 78u(d)(3)]; and
(f) Impose such other and further relief as the Court may deem just and
proper.
Dated: April 24, 2024    Respectfully submitted,

s/ Jennifer D. Reece
Jennifer D. Reece
Texas Bar No. 00796242
Robert J. Boudreau
Texas Bar No. 24123473
SECURITIES AND EXCHANGE COMMISSION
Fort Worth Regional Office
801 Cherry Street, Suite 1900
Fort Worth, TX  76102
Phone: (817) 978-6442 (JDR)
 (817) 978-0165 (RJB)
Fax: (817) 978-4927
[email protected]
[email protected]

ATTORNEYS FOR PLAINTIFF
SECURITIES AND EXCHANGE COMMISSION

1  

UNITED STATES DISTRICT COURT 
NORTHERN DISTRICT OF TEXAS 

FORT WORTH DIVISION 
 
  
SECURITIES AND EXCHANGE 
COMMISSION, 

 

  
          Plaintiff,  
 Cause No.  
v.  
  
GEOSYN MINING, LLC, CALEB JOSEPH 
WARD, and JEREMY GEORGE MCNUTT, 

 

  
          Defendants.  
  

 
COMPLAINT 

 
Plaintiff Securities and Exchange Commission (“SEC”) files this Complaint against 

Geosyn Mining, LLC (“Geosyn”), Caleb Joseph Ward (“Ward”), and Jeremy George McNutt 

(“McNutt”) (together, “Defendants”) and alleges as follows: 

SUMMARY OF THE ACTION 
 

1. Between November 2021 and December 2022, Defendants engaged in an 

unregistered and fraudulent securities offering through Geosyn, a crypto asset mining and 

hosting company founded and controlled by Ward and McNutt.  Together, Defendants raised 

over $5.6 million from approximately 64 investors through the sale of investment contracts 

called “Client Services Agreements” (“CSAs”).  Under the terms of the CSAs, Geosyn claimed it 

would purchase, maintain, and operate crypto asset mining machines and then distribute the 

mined crypto assets, such as bitcoin, to the investors for a fee.   

2. However, while soliciting investors, Defendants: (a) falsely claimed that Geosyn 

had favorable contracts with electricity providers which enabled Geosyn to operate the crypto 

asset mining machines profitably; (b) failed to disclose to new investors that they never 

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4:24-cv-00365



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purchased mining machines (or brought mining machines online) for some of the previous 

investors; and (c) failed to disclose that Geosyn was not providing the services that it claimed in 

its offering documents, such as allowing investors to personalize their crypto mining strategy or 

providing 24/7 onsite monitoring of the mining machines.  Further, of the investor funds raised, 

Ward and McNutt misappropriated approximately $1.2 million for personal use and paid 

approximately $354,500 to investors in purported mined bitcoin distributions, while admitting in 

messages to each other that they needed to buy bitcoin to fully fund distributions.  

3. By reason of this misconduct, the Defendants violated, and unless enjoined will 

continue to violate, the antifraud and registration provisions of the federal securities laws.  In the 

interest of protecting the public from further violations, the SEC brings this action seeking 

permanent injunctive relief, disgorgement of ill-gotten gains plus prejudgment interest, civil 

penalties and all other equitable and ancillary relief the Court deems necessary and proper. 

JURISDICTION AND VENUE 
 

4. This Court has jurisdiction over this action pursuant to Sections 20(b), 20(d), and 

22(a) of the Securities Act of 1933 (“Securities Act”) [15 U.S.C. §§ 77t(b), 77t(d), and 77v(a)] 

and Sections 21(d), 21(e), and 27(a) of the Securities Exchange Act of 1934 (“Exchange Act”) 

[15 U.S.C. §§ 78u(d), 78u(e), and 78aa(a)].  This action involves the offer and sale of investment 

contracts, which are specifically identified in the definitions of “security” under Section 2(a)(1) 

of the Securities Act and Section 3(a)(10) of the Exchange Act.  The Defendants directly or 

indirectly made use of the means or instrumentalities of interstate commerce or the mails in 

connection with the transactions, acts, practices, and courses of business alleged herein. 

5. Venue is proper in this district pursuant to Section 22(a) of the Securities Act [15 

U.S.C. § 77v(a)] and Section 27(a) of the Exchange Act [15 U.S.C. § 78aa(a)].  Certain of the 

transactions, acts, practices, and courses of business constituting violations of the federal 

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securities laws occurred within this district.  Further, at the time of the violations alleged in this 

matter, Geosyn had its principal place of business in this district, and both Ward and McNutt 

resided in this district. 

DEFENDANTS 
 

6. Geosyn is a Texas limited liability company offering crypto asset mining and 

hosting services.  Ward and McNutt formed Geosyn in August 2021 in Fort Worth, Texas.  

Geosyntek Holdings, Inc. (“Geosyntek”) is the parent entity and managing member of Geosyn.  

Neither Geosyn nor its securities are registered with the Commission.  

7. Ward, age 40, previously resided in Fort Worth, Texas, but relocated to Smyrna, 

Georgia in or around 2023.  During all relevant periods, Ward was the president, Chief Executive 

Officer (“CEO”), and co-founder of Geosyn.  During the Commission’s underlying investigation, 

Ward asserted his Fifth Amendment privilege against self-incrimination and refused to testify. 

8. McNutt, age 35, resides in Weatherford, Texas.  McNutt co-founded Geosyn and 

served as its Chief Operating Officer (“COO”) from January 2022 to October 2022, when he 

resigned.   

FACTUAL ALLEGATIONS 
 
A. Background 
 

1. Crypto Assets and Mining Technology 
 

9. As used herein, the term “crypto asset” generally refers to an asset issued and/or 

transferred using blockchain or distributed ledger technology, including assets referred to 

colloquially as “cryptocurrencies,” “virtual currencies,” and digital “coins.” 

10. A blockchain or distributed ledger is a database spread across a network of 

computers that records transactions in theoretically unchangeable, digitally recorded data 

packages, referred to as “blocks.”  These systems typically rely on cryptographic techniques to 

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secure recording of transactions. 

11. The capitalized term “Bitcoin” refers to the public ledger which supports Bitcoin 

blockchain technology; lower-case “bitcoin” refers to the crypto assets created by and 

electronically stored in the Bitcoin blockchain. 

12. Blockchains typically employ a “consensus mechanism” that, among other things, 

aims to achieve agreement among users as to which ledger transactions are valid, when and how 

to update the blockchain, and whether to compensate or “reward” certain participants for 

validating transactions and adding new blocks. 

13. One prevalent consensus mechanism, called “proof of work” and used by 

protocols such as Bitcoin, involves a network of computers expending computational effort to 

guess the value of a predetermined number.  The first computer to successfully guess this 

number earns the right to update the blockchain with a block of transactions and is rewarded or 

compensated with the blockchain’s native crypto asset.  The compensation can come from fees 

paid by those transacting on the blockchain as well as through newly created amounts of the 

blockchain’s native crypto asset.  Participants who undertake validating activities are known as 

“miners.”   

14. Typically, proof of work miners are more likely to earn rewards when they run 

large “farms” of mining equipment with little or no downtime.  This, coupled with the 

computationally intensive proof of work consensus mechanism, requires a great amount of 

electricity.  Lower operational costs, such as lower electricity costs, result in increased profit 

margins. 

15. “Hosting” generally refers to a third party’s provision of facilities and 

infrastructure to house, maintain and operate crypto asset mining machines on behalf of other 

miners. 

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2. Geosyn’s Founding 
 

15. Ward and McNutt met sometime around 2017 or 2018.  At the time, Ward ran an 

oil-and-gas mineral rights business and hired McNutt as an acquisition agent.  The two worked 

together in this capacity until 2020, when they began exploring alternative business 

opportunities.   

16. In mid-to-late 2021, Ward and McNutt founded Geosyn with the purported aim to 

offer investors the ability to profit from bitcoin mining by outsourcing to Geosyn the technical 

expertise, crypto asset miner procurement, and management of a complex crypto asset mining 

system.   

17. Ward and McNutt held the titles of CEO and COO, respectively.  While their 

roles overlapped, Ward was more heavily involved in investor solicitation, and McNutt managed 

Geosyn’s day-to-day operations.   

18. Geosyn rented two commercial spaces to operate its business and to house the 

crypto asset mining machines that it was purportedly going to purchase, maintain, and operate 

for investors.  The first facility was located in downtown Fort Worth, Texas (the “Magnolia 

Location”), and the second facility was located in a rural area northwest of Fort Worth (the 

“Springtown Location”).  At its height in 2022, Geosyn had approximately 12 employees. 

3. Soliciting Investors 

19. Geosyn obtained the majority of its investors through word-of-mouth.  Most 

investors were individuals, and not all were accredited.  Although Ward primarily led the 

solicitation efforts, McNutt and other Geosyn employees also directly solicited investors. 

20. Geosyn conducted a general solicitation of investors through its website 

(https://geosynmining.com/) and social media accounts.  Ward, McNutt, and Geosyn employees 

working under the Defendants’ directions set up and managed social media accounts for Geosyn 

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on Twitter, Telegram, Facebook, LinkedIn, and Reddit and used those accounts to advertise their 

mining business, to showcase their participation at crypto asset conferences, to disseminate 

facility development photos and progress updates, and to share crypto asset industry news.  

Geosyn also created a YouTube channel, on which it posted informational videos about crypto 

asset mining.  Ward led the marketing efforts, including co-managing the Geosyn website and 

overseeing Geosyn’s “marketing department” employees.   

21. In total, from at least November 2021 through December 2022, Geosyn raised 

approximately $5.6 million from approximately 64 investors in 18 states and three foreign 

countries. 

4.  Offering Documents 

22. Defendants provided investors with the following documents: (1) an investment 

contract that Geosyn called a CSA; and (2) an Excel file, which showed projected investment 

returns for the various mining machines that relied heavily on speculative increases in the value 

of bitcoin (“ROI Projections”).  At least some investors also received a one-page document 

summarizing the investment (“Summary Page”) and an investment deck with a flow chart 

identifying the steps from an initial investment with Geosyn to the investor receiving profits in a 

crypto asset wallet (“Flow Chart”).  Ward and McNutt collectively authored the CSA and 

Summary Page, and Ward was the sole creator of the ROI Projections.   

23. When signing the CSAs, Geosyn’s investors specified the number and model of 

mining machines that they wanted Geosyn to purchase on their behalf and agreed to pay Geosyn 

a 15% “procurement fee” above the cost of the mining machines.  In exchange for the 

investment, Geosyn agreed to purchase and run crypto asset mining machines on the investors’ 

behalf and to pay investors a return of profits in the form of monthly crypto asset distributions, 

minus deductions for Geosyn’s 7% hosting fee, mining pool fees, and electricity charges.  For 

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investors who did not provide separate crypto asset wallet addresses, Geosyn also provided 

electronic tablets with crypto asset wallets already installed to receive mining distributions. 

B. The Defendants’ Misrepresentations and False Statements 

24. Through Geosyn’s offering documents, Defendants claimed they would provide 

competitive crypto asset miner hosting services through expertise and economies of scale, such as 

connecting their machines to crypto asset mining pool networks to increase their chances of earning 

mining rewards.  However, almost everything that Defendants represented about Geosyn’s miner 

purchases and operations contained some element of falsity, as discussed below. 

1. False Statements About Electricity Contracts 

25. Profit margins in the crypto asset mining industry center on maintaining low 

energy costs.  Consistent with this market reality, Ward and other Geosyn representatives falsely 

represented, through the ROI Spreadsheet and in some instances through statements made 

directly to investors in conversations, emails, and text messages, that Geosyn had obtained 

commercial electricity contracts at $0.045 to $0.048 per kilowatt hour (“kWh”).  Similarly, the 

Summary Page claimed that Geosyn’s investors benefitted from “wholesale power pricing, 

which makes mining bitcoin more profitable.”  Geosyn’s low electricity cost was material to 

investors.   

26. In reality, Geosyn’s actual electricity costs did not benefit from “wholesale power 

pricing” and, at times, more than doubled the represented rates.  At the Magnolia Location, 

Geosyn’s landlord paid the building’s entire electricity costs and billed Geosyn for its pro-rata 

share.  Between February and November 2022, Geosyn’s electricity costs at the Magnolia 

Location ranged as high as 40-50% above the $0.045/kWh purported cost represented to 

investors.  Despite this knowledge, Ward and McNutt continued to provide the Summary Page 

and ROI Projections when soliciting new investors. 

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27. At the Springtown Location, Defendants fared even worse.  On behalf of Geosyn, 

McNutt’s mother signed a one-year contract with an electricity provider in April 2022 for a fixed 

base rate of $0.084743/kWh which, with delivery charges, was more than double the cost that 

Geosyn continued to represent to investors.  Two days before McNutt’s mother signed the 

electricity contract, McNutt and Ward exchanged text messages acknowledging that the actual 

electricity rates were well above the $0.045/kWh rate represented to investors.  In those 

messages, Ward discussed the idea of raising the electricity cost in the model projection that he 

provided to investors to $0.065/kWh.  But neither Ward nor anyone else at Geosyn ever changed 

the model projection or stopped citing the false $0.045/kWh rate. 

28.  In particular, Geosyn falsely told investors that, as a result of its supposed low-

cost electricity contracts, it could make a profit so long as the price of bitcoin remained in the 

$9,000–$15,000 range.  Yet, even though the price of bitcoin has not fallen below $16,000 since 

2020, Geosyn was unable to make a profit because it did not have the favorable electricity 

contracts that Defendants touted to investors. 

2.   False Statements to Investors about Miner Purchases and Operations 

29. Defendants lied to investors about how Geosyn would operate the mining 

machines.  In the Flow Chart, Geosyn represented to investors that it would purchase, set up, and 

begin to run mining machines within three to four weeks of an investor executing a CSA.  

Similarly, the Geosyn website stated that machines would generally come online within six 

weeks of investment.  Once the mining machines were online, Geosyn’s CSA and website also 

promised investors 98% guaranteed run time and that Geosyn would provide necessary 

maintenance and 24/7 site monitoring and security for the mining machines.  In the Summary 

Page, Geosyn also represented that investors could personalize their mining strategies by 

selecting which specific crypto assets to mine.   

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30. On March 15, 2022, Geosyn issued a press release in which Ward is quoted as 

falsely stating that, within its first month of operation, the Magnolia Location was at “full 

capacity,” prompting Geosyn to open the Springtown location to host additional mining 

machines. 

31. Out of the approximately 1,400 machines that Geosyn entered CSAs to purchase, 

Geosyn, as Ward and McNutt knew, failed to purchase about 400 mining machines and never 

brought most of the purchased mining machines online.   

32. As for the mining machines that it did procure and turn on, Geosyn did not allow 

investors to personalize their mining strategies.  Instead, Geosyn rejected investor requests to 

mine any crypto asset other than bitcoin.   

33. Geosyn also did not provide adequate security, and experienced two break-ins at 

the Springtown Location. 

 3.  False Statements about Profitability and Lulling Payments 

34. Ward continued to solicit additional investments through periodic emails, though 

none of the investors ultimately decided to invest additional funds beyond their initial investment 

amounts.   

35. To make investors believe that their mining machines were operational and 

profitable when they were not, Geosyn made periodic bitcoin distributions to investors at least as 

late as February 2023.  Geosyn also publicized distribution payments in its March 15, 2022 press 

release, touting that Geosyn made its first bitcoin distribution to investors on February 22, 2022. 

36. In total, Geosyn only collected approximately $320,000 from bitcoin mining.  But 

Geosyn distributed approximately $354,500 in bitcoin to investors (this number does not take 

into account Ward’s and McNutt’s other misappropriations, as discussed below).  To make up 

for the shortfall, in part, Geosyn distributed to its investors bitcoin that McNutt purchased and 

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sent to Ward.  In text messages exchanged in June and July 2022, McNutt and Ward expressly 

discussed their scheme to purchase bitcoin to fund investor distributions. 

37. Geosyn also distributed bogus documents to investors to create the appearance of 

profitability.  Ward prepared and sent investors monthly distribution statements showing 

fabricated mining production rates and profits for Geosyn and for the clients’ purported shares of 

the production.  The monthly reports included fabricated deductions for: (a) electricity costs, 

calculated at the understated $0.045/kWh rate; (b) mining pool fees; and (c) Geosyn’s 7% 

hosting fee. 

C. Defendants Misappropriated Investor Funds.  
 

38. Defendants directed investors to send money to Geosyn’s bank accounts to 

purchase their investment contracts.  Investors wired their funds or mailed checks, which were 

deposited into Geosyn’s accounts.  In a few instances, investors paid with bitcoin transfers.  

Because Ward and McNutt controlled Geosyn’s operations and its bank accounts, they were able 

to move investor funds as they wished.  Ward and McNutt both had access to and control of the 

Geosyn company credit card, which was paid from Geosyn bank accounts. 

39. Ward misappropriated approximately $402,455.35 from Geosyn in the form of 

cash withdrawals, bank transfers, and company credit card charges.  Ward used the investor 

funds for a variety of personal expenses and items, including meals and entertainment, business 

expenses unrelated to Geosyn, and other items. 

40. McNutt misappropriated approximately $862,095.13 from Geosyn in the form of 

cash withdrawals, bank transfers, and company credit card charges.  McNutt used the investor 

funds for a variety of personal expenses and items, including vacation travel, construction 

materials, personal legal fees, firearms, wrist watches, and other items. 

41. The offering documents did not authorize Ward or McNutt to use investor funds 

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for personal use, and the Defendants did not disclose that any investor funds would be used for 

Ward’s and McNutt’s personal benefit.  To the contrary, under the terms of the offering 

documents, investor funds were to be used to purchase crypto asset mining machines, and an 

additional 15% fee was added for Geosyn’s operations.  The statements in the offering 

documents about how the Defendants intended to use investor funds were false and misleading. 

42. To maintain a façade of success, Ward and McNutt attended several crypto asset-

technology conferences in 2022 and spent tens of thousands of dollars on flights for themselves 

and Geosyn employees, luxury accommodations, nightclubs, and other entertainment venues. 

43. At Ward’s direction, McNutt charged approximately $20,000 to his Geosyn credit 

card to pay for Ward’s Las Vegas nightclub wedding celebration.  Additionally, from June to 

August 2022, McNutt charged approximately $49,000 on his Geosyn credit card in connection 

with a family trip to Disney World.  The charges included payments for Disney World tickets, 

Disney World vendors, an Airbnb rental, and airfare.  Finally, as Geosyn’s operations ground to 

a halt in 2023, Ward liquidated the Geosyn crypto asset wallet, and kept about $57,000 for 

himself.  

44. At one crypto asset conference in June 2022, McNutt was involved in a car 

accident, and he and another Geosyn employee were separately arrested for drunk driving 

(“DUIs”).  Subsequently, Ward and McNutt authorized Geosyn to use investor funds to pay 

approximately $22,000 for a breathalyzer device and for other expenses related to the DUIs and 

consequent criminal charges. 

D. The Unraveling of the Geosyn Scheme 

45. In late 2022, Defendants’ scheme began to unravel as new investor funds dried 

up.  Geosyn received its last new-investor funds by December 2022.   

46. With no new investor funds to finance Geosyn’s operations, Ward blamed 

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McNutt for the failing business.  Around October 2022, Ward accused McNutt of embezzling 

from Geosyn, and on October 7, 2022, McNutt signed a release agreement under which he 

agreed to surrender his ownership interest in Geosyn and its affiliates.   

47. In December 2022, Ward voluntarily contacted criminal authorities to report that 

McNutt had embezzled funds from Geosyn without disclosing his own misappropriations.    

48. The week before Christmas 2022, Ward terminated all but two Geosyn 

employees, retaining his personal assistant and another employee who assisted with operating the 

mining machines.  Having failed to pay electricity costs, Ward was forced to abandon the 

Magnolia Location and to move all of Geosyn’s operations to the Springtown Location.  

According to Geosyn’s bank records, on December 27, 2022, Geosyn had a balance of only 

approximately $1,874.  

49. Despite Geosyn’s dire financial straits, Ward continued some form of operations 

into 2023.  Around the start of 2023, Ward began emailing investors “IOUs,” noting that the 

investors were owed bitcoin distributions that Geosyn would pay later.  Ward also sent emails to 

investors claiming that there were operational hiccups due to “malfeasance,” difficulties 

procuring electricity, and struggles with upgrading power systems.  As Geosyn’s prospects of 

recruiting new investors dwindled, Ward frantically sought outside funds to keep Geosyn 

operating. 

50. While Geosyn was faltering, several investors demanded to take possession of the 

mining machines they purchased through Geosyn.  One such investor (“Investor A”) had 

contracted with Geosyn for the purchase of 90 mining machines.  Geosyn never purchased those 

mining machines, and instead sent Investor A mining machines that belonged to an unrelated 

investor.  When Investor A arranged to pick up 51 additional mining machines from the 

Springtown Location that he had previously procured himself and contracted with Geosyn to 

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host, he discovered that the 51 mining machines were still in their original packaging. 

51. On May 25, 2023, the Springtown Location’s landlord locked-out Ward and 

Geosyn due to non-payment of rent. 

52. On June 1, 2023, Ward emailed the investors to state that Geosyn would file for 

bankruptcy, an event that never transpired. 

FIRST CLAIM FOR RELIEF 

Geosyn, Ward, and McNutt violated Section 10(b) of the Exchange Act [15 U.S.C. § 78j(b)] 
and Rule 10b-5 thereunder [17 C.F.R. § 240.10b-5] 

 
53. The SEC re-alleges and incorporates by reference each and every allegation 

contained in the paragraphs above. 

54. By engaging in the conduct described herein, each Defendant, directly or 

indirectly, singly or in concert, by the use of the means or instrumentalities of interstate 

commerce and/or by use of the mails, in connection with the purchase or sale of securities, has: 

(a) employed a device, scheme, or artifice to defraud; and/or (b) made an untrue statement of a 

material fact, or omitted to state a material fact necessary in order to make the statements made, 

in light of the circumstances under which they were made, not misleading; and/or (c) engaged in 

an act, practice, or course of business which operated or would operate as a fraud or deceit upon 

purchasers, prospective purchasers, and any other persons. 

55. Each Defendant acted with scienter and engaged in the referenced acts knowingly 

and/or with severe recklessness. 

56. By reason of the foregoing, each Defendant has violated, and unless enjoined will 

continue to violate, Section 10(b) of the Exchange Act [15 U.S.C. § 78j(b)] and Rule 10b-5 

thereunder [17 C.F.R. § 240.10b-5]. 

 

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SECOND CLAIM FOR RELIEF 

Geosyn, Ward, and McNutt violated Section 17(a) of the Securities Act [15 U.S.C. § 77q(a)] 
 

57. The SEC re-alleges and incorporates by reference each and every allegation 

contained in the paragraphs above. 

58. By engaging in the conduct described herein, each Defendant, directly or 

indirectly, singly or in concert with others, in the offer or sale of securities, by use of the means 

or instruments of transportation or communication in interstate commerce and/or by use of the 

mails, has: (a) employed a device, scheme, or artifice to defraud; and/or (b) obtained money or 

property by means of an untrue statement of a material fact or an omission to state a material fact 

necessary in order to make the statements made, in light of the circumstances under which they 

were made, not misleading; and/or (c) engaged in a transaction, practice, or course of business 

which operated or would operate as a fraud or deceit upon the purchaser. 

59. With regard to the Defendants’ violations of Section 17(a)(1) of the Securities 

Act, the Defendants acted with scienter and engaged in the referenced acts knowingly and/or 

with severe recklessness.  With regard to the Defendants’ violations of Sections 17(a)(2) and 

17(a)(3) of the Securities Act, the Defendants acted at least negligently. 

60. By reason of the foregoing, each Defendant has violated, and unless enjoined will 

continue to violate, Section 17(a) of the Securities Act [15 U.S.C. § 77q]. 

THIRD CLAIM FOR RELIEF 

Geosyn, Ward, and McNutt violated Sections 5(a) and 5(c) of the Securities Act [15 U.S.C. 
§§ 77e(a) & (c) 

 
61. The SEC re-alleges and incorporates by reference each and every allegation 

contained in the paragraphs above. 

62. By engaging in the conduct described above, each Defendant, directly or 

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indirectly, singly and in concert with others, has: (a) made use of the means or instruments of 

transportation or communication in interstate commerce or of the mails to sell, through the use or 

medium of any prospectus or otherwise, securities as to which no registration statement was in 

effect; and/or (b) for the purpose of sale or delivery after sale, carried or caused to be carried 

through the mails or in interstate commerce, by the means or instruments of transportation, 

securities as to which no registration statement was in effect; and/or (c) made use of the means or 

instruments of transportation or communication in interstate commerce or of the mails to offer to 

sell, through the use or medium of any prospectus or otherwise, securities as to which no 

registration statement has been filed. 

63. By reason of the foregoing, each Defendant violated, and unless enjoined will 

continue to violate, Sections 5(a) and 5(c) of the Securities Act [15 U.S.C. §§ 77e(a) and 

77(e)(c)]. 

RELIEF REQUESTED 
 

Therefore, the SEC respectfully requests that this Court: 
 

(a) Permanently enjoin each Defendant from violating, directly or 

indirectly, Sections 5(a), 5(c), and 17(a) of the Securities Act [15 U.S.C. §§ 77e(a), 77e(c) 

and 77q(a)] and Section 10(b) of the Exchange Act [15 U.S.C. § 78j(b)] and Rule 10b-5 

thereunder [17 C.F.R. § 240.10b-5]; 

(b) Permanently restrain and enjoin Ward and McNutt from participating, 

directly or indirectly, including, but not limited to, through any entity controlled by either of 

them, in any offering of securities, including any crypto asset security; provided, however, 

that such injunctions shall not prevent them from purchasing or selling securities, including 

any crypto asset security, for their own personal accounts; 

(c) Permanently bar Ward and McNutt from serving as an officer or 

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director of any issuer that has a class of securities registered pursuant to Section 12 of the 

Exchange Act [15 U.S.C. § 78l] or that is required to file reports pursuant to Section 15(d) 

of the Exchange Act [15 U.S.C. § 78o(d)]; 

(d) Order Ward and McNutt to each disgorge his ill-gotten gains, plus 

prejudgment interest on those amounts, pursuant to Exchange Act Sections 21(d)(3), 

21(d)(5), and 21(d)(7) [15 U.S.C. §§ 78u(d)(3), 78u(d)(5), and 78u(d)(7)]; 

(e) Order Ward and McNutt to each pay a civil penalty pursuant to 

Section 20(d) of the Securities Act [15 U.S.C. § 77t(d)] and/or Section 21(d)(3) of the 

Exchange Act [15 U.S.C. § 78u(d)(3)]; and 

(f) Impose such other and further relief as the Court may deem just and 

proper. 

Dated: April 24, 2024    Respectfully submitted, 
 
 

s/ Jennifer D. Reece    
Jennifer D. Reece 
Texas Bar No. 00796242 
Robert J. Boudreau 
Texas Bar No. 24123473 
SECURITIES AND EXCHANGE COMMISSION 
Fort Worth Regional Office 
801 Cherry Street, Suite 1900 
Fort Worth, TX  76102 
Phone: (817) 978-6442 (JDR) 
 (817) 978-0165 (RJB) 
Fax: (817) 978-4927 
[email protected] 
[email protected] 
 
ATTORNEYS FOR PLAINTIFF  
SECURITIES AND EXCHANGE COMMISSION 

 

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