The SEC has secured a default judgment against NanoBit for investment fraud, with total penalties exceeding $5.5 million.
The U.S. District Court for the Eastern District of New York has ruled against NanoBit, a fraudulent cryptocurrency platform, in a case brought by the Securities and Exchange Commission (SEC).
NanoBit Limited, along with its associated companies Radiant Horizons Limited, Sweet Karma Fashion Inc., and Zhao Tropical Deli Inc., as well as entrepreneurs Jia Jie Liu and Hua Zhao, were found guilty of investment fraud.
NanoBit Limited has been ordered to pay around $1.8 million, while the other companies face fines of approximately $1.2 million each, bringing the total penalties to over $5.5 million.
The court has barred the defendants from engaging in any activities related to the issuance, purchase, or sale of securities, although Liu and Zhao can still make transactions on their personal accounts.
This default judgment was granted due to the defendants’ absence and failure to contest the charges.
The SEC's complaint, filed on September 17, 2024, detailed that the fraudulent scheme operated from September 2023 to June 2024. The defendants allegedly used WhatsApp to lure potential victims by posing as financial experts and promoting the NanoBit platform.
According to the SEC, the platform misrepresented trading activities and profit growth, with victims' funds disappearing when withdrawal attempts were made. The complaint also noted that NanoBit falsely claimed affiliation with a registered brokerage, NanobitUS Securities, and promoted fraudulent ICOs with unrealistic return promises.
A total of 18 investors lost at least $967,835, with around $725,335 received in cryptocurrency and $242,500 in fiat currency. The SEC reported that these funds were transferred from the U.S. to accounts in Hong Kong.
In related news, Thai authorities have issued an arrest warrant for Chinese entrepreneur Wang Yichen for alleged illegal mining and money laundering related to fraud and gambling activities.
