On Monday, the U.S. Securities and Exchange Commission (SEC) filed an emergency action against a Miami-based crypto hedge fund and its co-founders for allegedly running a fraudulent scheme. Here is a summary of the details:

Allegations

• BKCoin Management LLC, a Miami-based investment adviser, and its principal Kevin Kang allegedly ran a $100 million Ponzi-like scheme involving cryptocurrency investments and misrepresenting investor returns.
• The SEC alleges that the fund raised more than $100 million from over 1,000 investors across the United States and internationally through misrepresentations about the nature and performance of their investments, among other things.

Emergency Relief Obtained

• The SEC successfully obtained an asset freeze, appointment of a receiver, and other emergency relief against BKCoin Management LLC and Kevin Kang.
• The Florida court granted the emergency relief requested by the SEC to freeze and appoint a receiver for the fund’s assets.

SEC’s Efforts to Protect Investors

• The SEC has been actively pursuing fraudsters in the cryptocurrency industry in recent years.
• In addition to this case, the SEC filed an emergency action charging an offshore fund and two individuals engaging in a fraudulent scheme and obtained an asset freeze to safeguard remaining investor funds at risk of immediate dissipation.

Step-by-Step Process

1. The SEC files an emergency action against a Miami-based crypto hedge fund and its co-founders for allegedly running a fraudulent scheme.
2. The SEC alleges that the fund raised more than $100 million from over 1,000 investors through misrepresentations about the nature and performance of their investments, among other things.
3. The SEC successfully obtained an asset freeze, appointment of a receiver, and other emergency relief against the fund and its co-founders.
4. The Florida court granted the emergency relief requested by the SEC to freeze and appoint a receiver for the fund’s assets.
5. The SEC has been actively pursuing fraudsters in the cryptocurrency industry in recent years.
6. In addition to this case, the SEC filed an emergency action charging an offshore fund and two individuals engaging in a fraudulent scheme and obtained an asset freeze to safeguard remaining investor funds at risk of immediate dissipation.