SEC Charges Two Firms With $15M WhatsApp, Crypto Frauds

The Securities and Exchange Commission suspects several business entities are fronts for dual international fraud schemes that bilked at least $15 million from investors via WhatsApp and other social media platforms.

The complaints against Cryptoaiml and TSAI were filed in New York federal court, accusing the companies of schemes that falsely told investors they were in regulatory compliance while stealing at least $12.5 million and $2.8 million, respectively.

“Although the methods used to bilk innocent investors in these fraudulent investment scams varied, the goal was the same—promise potential investors outside returns, claim that they were legitimate entities regulated by the SEC, and then steal their money,” SEC Enforcement Division Director David Woodcock said about the charges.

According to the Cyptoaiml complaint, the company filed a Form D with the commission, but falsified the information on it. Starting in August 2024, the company created WhatsApp group chats to interact with investors, while purporting to be “experienced investment professionals.”

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In some cases, the defendants forged an advisor/client relationship with investors who signed agreements they believed were legitimate. On the platform, they claimed to be actual investment professionals; those individuals had no idea they were being impersonated, according to the complaint.