SEC Charges Team Behind Coindeal Crypto Fraud That Promised 500,000 Times Investment Returns

The U.S. Securities and Exchange Commission (SEC) has charged the team behind Coindeal, a $45 million fraudulent crypto investment scheme. The regulator explained that the defendants falsely claimed that Coindeal “would generate investment returns of more than 500,000 times for investors.”

The U.S. Securities and Exchange Commission (SEC) announced Wednesday that it has charged the creator of crypto investment scheme Coindeal and seven others in connection with the $45 million fraud.

Describing Coindeal as “a brazen and far-reaching unregistered offering fraud conducted between at least 2018 and 2022,” the securities regulator detailed:

Coindeal … raised more than $45 million from sales of unregistered securities to tens of thousands of investors worldwide.

The SEC explained that creator Neil Chandran and promoters Garry Davidson, Michael Glaspie, Amy Mossel, and Linda Knott “falsely claimed that investors could generate extravagant returns by investing in a blockchain technology called Coindeal that would be sold for trillions of dollars to a group of prominent and wealthy buyers.”

However, the regulator said no Coindeal sale ever occurred and no distributions were made to investors. The defendants “collectively misappropriated millions of dollars of investor funds for personal use, and Chandran used investor funds to purchase items such as cars, real estate, and a boat,” the SEC wrote.

The securities watchdog also charged AEO Publishing Inc., Banner Co-Op Inc., and Bannersgo LLC for their involvement in the fraudulent crypto investment scheme.

Daniel Gregus, director of the SEC’s Chicago Regional Office, said:

We allege the defendants falsely claimed access to valuable blockchain technology and that the imminent sale of the technology would generate investment returns of more than 500,000 times for investors.

The director added: “As alleged in our complaint, in reality, this was all just an elaborate scheme where the defendants enriched themselves while defrauding tens of thousands of retail investors.”

In June last year, the U.S. Department of Justice (DOJ) indicted Chandran on three counts of wire fraud and two counts of monetary transaction in unlawful proceeds in connection with the Coindeal crypto fraud scheme.

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