The U.S. Securities and Exchange Commission (SEC) has charged a citizen of Latvia with defrauding investors in two crypto offerings. The fraudster “used fake names, fictitious entities, and fraudulent profiles to perpetrate his schemes, and misappropriated nearly all of the investor funds that were raised.”
Two Fraudulent Crypto Schemes
The SEC announced Thursday that it has “charged a Latvian citizen with defrauding hundreds of retail investors out of at least $7 million through two separate fraudulent digital asset securities offerings.”
Noting that Ivars Auzins defrauded U.S. and foreign investors, the securities watchdog explained:
Auzins allegedly used fake names, fictitious entities, and fraudulent profiles to perpetrate his schemes, and misappropriated nearly all of the investor funds that were raised.
His first scheme ran from January through March 2018. “Auzins fraudulently offered and sold unregistered digital tokens as part of an ICO [initial coin offering] of Denaro, a purported multi-currency debit card platform,” the SEC detailed.
The complaint alleges that “all of the claimed products or services being offered were fictitious, including the relationship with the credit card issuer,” noting that “Auzins misappropriated all of the ICO’s proceeds.”
His second scheme ran from April through July 2019. “Auzins fraudulently offered the unregistered securities of Innovamine, which purportedly offered a cloud mining program,” the SEC described, adding that he “misappropriated nearly all of the funds raised in the offering.”
The securities regulator detailed:
As we allege, Auzins was engaged in a brazen scheme to defraud retail investors under the guise of profitable digital asset opportunities.
The Latvian citizen is charged with “violating the antifraud and registration provisions of the federal securities laws.” The SEC “seeks permanent injunctions, including conduct-based injunctions, disgorgement plus prejudgment interest, civil penalties, and an officer-and-director bar against him.”
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