SEC charges Unicoin with $100 million crypto fraud

Unicoin Inc., a company based in New York, along with its top executives, committed a $100 million fraud scheme, according to accusations from the U.S. Securities and Exchange Commission (SEC).

The SEC charged executives Alex Konanykhin, Silvina Moschini, and Alex Dominguez, along with their company, for allegedly issuing misleading information about certificates linked to cryptocurrency and stock rights, as stated in a May 20 release.

“We allege that Unicoin and its executives exploited thousands of investors with fictitious promises that its tokens, when issued, would be backed by real-world assets including an international portfolio of valuable real estate holdings,” said Mark Cave, associate director in the SEC’s Division of Enforcement, in the statement

Cave noted that the company presented real estate assets worth only a tiny percentage of the figure they claimed.

Under Donald Trump’s pro-crypto presidency, the SEC dropped numerous high-profile crypto cases, including legal actions against Binance Holdings Ltd. and Coinbase Global Inc.

Paul Atkins, the newly appointed SEC Chair, stated that he will focus on establishing clear and consistent regulations for digital assets, guided by a “rational, coherent, and principled approach.”

However, the agency has not fully stepped away from enforcing crypto regulations.

In April, the SEC filed charges against Praetorian Group International Corp., a crypto and foreign exchange firm, accusing them of running a $198 million Ponzi and pyramid scheme.

According to the SEC’s May 20 statement, Unicoin used advertising in key airports and on thousands of taxis in New York City to promote certificates to the public.

The group and its executives allegedly persuaded over 5,000 investors to invest in the certificates.

The SEC alleged that Unicoin marketed tokens and certificates as SEC-registered and claimed sales surpassing $3 billion, despite only selling $110 million worth.

The SEC also alleges that Richard Devlin, serving as Unicoin’s general counsel, violated federal securities laws.

Without conceding or disputing the SEC’s charges, Devlin paid a civil penalty amounting to $37,500.

On April 21, Eleanor Terrett, formerly with FOX Business, disclosed that the SEC served Unicoin a Wells notice in December about a token airdrop and called them to a settlement meeting on April 18.

Konanykhin informed Terrett that his company rejected the meeting invitation due to objectionable conditions set by the regulator and chose to pursue the matter in court.