The U.S. Securities and Exchange Commission has charged three individuals for various cryptocurrency frauds including the 2018 initial coin offering for the Steven Seagal-promoted altcoin, Bitcoiin2Gen.
A Feb. 1 SEC announcement estimates that Bitcoiin Gen founder John DeMarr, Start Options founder Kristijan Krstic, and promotor Robin Enos duped investors out of more than $11 million through two fraudulent and unregistered securities offerings from December 2017 until May 2018.
The SEC alleges that Krstic and DeMarr first spruiked Start Options’ purported crypto asset mining and trading platform in December 2017 and January 2017, falsely claiming it was “the largest Bitcoin exchange in euro volume and liquidity” at the time.
From January until May of 2018, the trio then promoted Bitcoiin2Gen’s ICO, with the SEC accusing the individuals of knowingly disseminating fraudulent promotional materials to the investing public.
The complaint asserts Bitcoiin2Gen’s empty promises included purporting Ethereum compatibility for its B2G token, claiming the raised funds would be reinvested into developing a mineable crypto asset, and asserting the B2G token would be tradable on a proprietary exchange. However, according to the SEC:
“Bitcoiin2Gen was a sham, and Krstic and DeMarr allegedly misappropriated millions of dollars of investor funds for their own personal benefit.”
Krstic and DeMarr will face charges of violating the antifraud and registration provisions of federal securities laws, while Enos will face charges of aiding and abetting said antifraud violations. The SEC is seeking disgorgement plus interest, penalties, and a bar against Krstic and DeMarr from operating or directing companies in future.
“The conduct alleged in this action was a blatant attempt to victimize those interested in digital asset technology and these defendants should be held accountable,” said Kristina Littman, chief of the SEC Enforcement Division’s Cyber Unit
On the same day, the…