According to DLNews, a Texas-based money manager, Khalid Parekh, has been fined $100,000 by the US Securities and Exchange Commission (SEC) for illegally investing $18.5 million of his clients' funds into cryptocurrencies without their knowledge. Parekh, who is the sole owner and manager of Fair Invest, solicited funds from 373 investors across 40 states between August 2021 and August 2022. He specifically targeted the Muslim community in the US, claiming that his investment strategies were compliant with Islamic law and promising a 4% annual return.
The SEC's investigation revealed that instead of investing in conventional assets like equities, mutual funds, commodities, and exchange-traded funds as promised, Parekh allocated the funds to two undisclosed crypto-lending platforms. Despite requests for comment, neither Parekh nor the SEC spokesperson provided further details on the platforms involved. During the investigation, Parekh returned the invested funds to his clients, including the promised 4% interest, and withdrew his registration as an investment adviser with the SEC.