• The US Securities and Exchange Commission (SEC) has filed an emergency action against the Miami-based financial advisor firm – BKCoin Management LLC – and its Co-Founder Kevin Kang, claiming they have defrauded investors with $100 million via a fraudulent crypto scheme.
• The agency seeks to impose financial penalties on the organization and a conduct-based injunction against Kang.
• BKCoin allegedly lied to users that it received an audit opinion from a „top four auditor“ while, in fact, it never obtained such a notion.
US SEC Files Emergency Action Against BKCoin Management
The US Securities and Exchange Commission (SEC) has filed an emergency action against the Miami-based financial advisor firm – BKCoin Management LLC – and its Co-Founder Kevin Kang, claiming they have defrauded investors with $100 million via a fraudulent crypto scheme. The watchdog froze assets connected to BKCoin after filing this action.
Accusations of Fraudulent Crypto Scheme
According to the SEC’s press release, BKCoin raised around $100 million from at least 55 investors between October 2018 and September 2022 by promising significant returns on their investments if used for trading cryptocurrencies. However, instead of adhering to the outlined plan, the defendants are accused of using $3.6 million of these funds for Ponzi-like payments as well as stealing over $370,000 for personal benefits such as holidays, sporting events tickets, and even a property in New York City.
False Audit Opinion Claim
The complaint also alleges that BKCoin lied to its customers by saying that it had received an audit opinion from one of the “top four auditors” when in fact they had not gained any such opinion at all. Furthermore, they failed to register with the SEC or provide disclosure documents related to their offering.
Penalties Imposed by SEC
As part of this emergency action taken by the SEC against BKCoin Management LLC and Kevin Kang, financial penalties are being imposed on them along with a conduct-based injunction against Kang himself.
Conclusion
The US SEC is continuing its efforts towards protecting investors from frauds like these through its enforcement actions and aggressive investigation tactics into such cases of securities law violations.