SEC accused cryptocurrency platforms NanoBit and CoinW6 of deceiving investors and stealing their money through a series of social media scams. Two complaints have been filed against five organizations and three individuals.
According to the regulator, NanoBit employees solicited funds from October 2023 to June 2024 through WhatsApp groups, posing as “financial industry professionals.” They falsely claimed that their subsidiary, NanobitUS Securities, held a broker license.
The fraudsters employed fake ICOs as one of their methods to obtain funding.
In total, participants in the scheme illegally appropriated hundreds of thousands of dollars in cryptocurrencies and over $2 million, which they transferred to Hong Kong through bank accounts.
The second complaint alleges that CoinW6 employees contacted investors from July 2022 to December 2023 via LinkedIn and Instagram, as well as established “romantic relationships through WhatsApp.” Victims were promised up to 3% daily returns from staking, mining, and other platform products.
When users attempted to withdraw their supposed profits, the fraudsters demanded additional payments for taxes and fees or claimed that funds were frozen due to law enforcement investigations. Some victims were blackmailed with compromising intimate messages.
The SEC accuses the companies and individuals of violating anti-fraud provisions of federal securities laws. The regulator seeks permanent injunctions, the return of ill-gotten gains with interest, and civil penalties against each defendant through the courts.
Back in 2022, U.S. authorities reported on the popularity of romantic scams alongside the “pig butchering” scheme among bitcoin fraudsters.
According to a recent Chainalysis report, criminals are shifting focus from creating financial pyramids to such targeted types of deception.