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The Securities and Exchange Commission charged three crypto trading platforms and four investment clubs with defrauding retail investors of more than $14 million through a coordinated scheme that used social media ads, WhatsApp groups, and fake artificial intelligence trading advice to lure and deceive victims.
The case, announced in Washington, D.C., on Dec. 22, centers on Morocoin Tech Corp., Berge Blockchain Technology Co. Ltd., and Cirkor Inc., alongside investment clubs AI Wealth Inc., Lane Wealth Inc.,
AI Investment Education Foundation Ltd., and Zenith Asset Tech Foundation. Regulators say the defendants orchestrated a coordinated crypto investment scam between January 2024 and January 2025, targeting everyday investors across the United States.
According to the SEC, the alleged crypto investment scam followed a carefully staged playbook. The investment clubs reportedly attracted victims through paid advertisements on popular social media platforms, promising access to exclusive investment groups and advanced, AI-generated trading insights.
Once recruited, investors were funneled into WhatsApp group chats where fraudsters allegedly posed as financial professionals.
These groups shared what they claimed were artificial intelligence–powered investment tips, gradually building credibility and trust among participants. Regulators say this trust was then leveraged to persuade investors to open and fund accounts on the defendants’ purported crypto trading platforms.
“These platforms falsely claimed to have government licenses,” the SEC alleged, adding that no real trading activity ever occurred.
Instead, the platforms were allegedly designed to simulate legitimate activity while investor funds were quietly misappropriated.
The SEC described the operation as a textbook crypto investment scam, combining social engineering, technological buzzwords, and fake infrastructure to create the illusion of legitimacy.
Central to the alleged crypto investment scam were so-called “Security Token Offerings” promoted to investors as opportunities tied to established businesses. According to the complaint, neither the token offerings nor their purported issuing companies actually existed.
When investors attempted to withdraw funds, regulators allege the scheme escalated. Victims were reportedly told they needed to pay additional “advance fees” or taxes to unlock their balances—fees that only deepened their losses.
In total, the SEC claims the defendants misappropriated at least $14 million from U.S.-based retail investors. The funds were allegedly moved overseas through a complex network of bank accounts and crypto asset wallets, making recovery more difficult.
“This matter highlights an all-too-common form of investment scam that is being used to target U.S. retail investors with devastating consequences,” said Laura D’Allaird, Chief of the SEC’s Cyber and Emerging Technologies Unit.
“Fraud is fraud, and we will vigorously pursue securities fraud that harms retail investors.”
Her comments underscore the regulator’s view that, despite the novel packaging, the case represents a familiar crypto investment scam rooted in deception rather than innovation.
The SEC’s complaint charges the defendants with violating the anti-fraud provisions of the Securities Act of 1933 and the Securities Exchange Act of 1934. The agency is seeking permanent injunctions, civil penalties, and disgorgement with prejudgment interest against the alleged operators of the fake trading platforms.
Beyond enforcement, the SEC emphasized investor education as a key defense against the next crypto investment scam. Its Office of Investor Education and Assistance has issued alerts warning that fraudsters increasingly rely on social media platforms and encrypted messaging apps to lure victims.
“The SEC encourages investors to use Investor.gov to check the background of anyone offering or selling them an investment,” the agency stated, cautioning investors against relying solely on information shared in group chats.
