In an unprecedented operation, the Securities and Exchange Commission (SEC), the Federal Bureau of Investigation (FBI), and the U.S. Department of Justice (DOJ) have coordinated the takedown of four fraudulent crypto companies. Among those charged are Gotbit Consulting, ZM Quant Investment, and CLS Global, which face charges of market manipulation and fraud, related to projects such as Saitama and Robo Inu. In total, 18 individuals and one additional company, MyTrade MM, are being prosecuted for their alleged crimes.
The charges, filed in the District Court of Massachusetts, point to an elaborate network of fraudulent operations, including "wash trading" and the creation of fictitious cryptocurrencies to manipulate the market. One of the defendants, Vy Pham, was named as the mastermind behind several of these operations. Although some executives reside in Russia, London and Hong Kong, authorities are seeking to recover illicit profits and apply civil penalties.
This joint effort between major US law enforcement agencies underscores growing concerns about fraudulent practices in the crypto space. The investigation continues and more cryptocurrencies, such as SaitaRealty and NexFundAI, are under scrutiny.