Washington, D.C.--(Newsfile Corp. - November 1, 2023) - The Securities and Exchange Commission today charged SafeMoon LLC, its creator Kyle Nagy, SafeMoon US LLC, and the companies' Chief Executive Officer, John Karony, and Chief Technology Officer, Thomas Smith, for perpetrating a massive fraudulent scheme through the unregistered sale of the crypto asset security, SafeMoon. According to the SEC's complaint, the Defendants promised to take the price of the token "Safely to the moon," but instead of delivering profits, they wiped out billions in market capitalization, withdrew crypto assets worth more than $200 million from the project, and misappropriated investor funds for personal use.
"Decentralized finance claims to deliver transparency and predictable outcomes, but unregistered offerings lack the disclosures and accountability that the law demands, and they attract scammers like Kyle Nagy, who use these vulnerabilities to enrich themselves at the expense of others," said David Hirsch, Chief of the SEC Enforcement Division's Crypto Assets and Cyber Unit (CACU).
According to the SEC's complaint, in marketing the SafeMoon Token, Nagy assured investors that funds were safely locked and could not be withdrawn by anyone, including the Defendants, while held in SafeMoon's liquidity pool, a collection of investor funds that provides liquidity to facilitate trading in the asset. However, as alleged, large portions of the liquidity pool were never locked, and the Defendants misappropriated millions of dollars to purchase McClaren cars, extravagant travel, luxury homes, and other things.
"We urge investors to continue to exercise extreme caution in this space, as fraudsters exploit the popularity of crypto assets to promise astronomical profits while all too frequently only delivering a crash landing," said Jorge G. Tenreiro, Deputy Chief of the CACU.
The SEC's complaint alleges that SafeMoon skyrocketed in price by more than 55,000 percent from March 12 to April 20, 2021, and reached a market capitalization exceeding $5.7 billion before its price plummeted by nearly 50 percent when the public learned, on April 20, 2021, that SafeMoon's liquidity pool was not locked as claimed. After this plunge, Karony and Smith allegedly used misappropriated assets to make large purchases of SafeMoon to prop up its price and manipulate the market. Karony also allegedly used an account he opened on a trading platform to buy and sell SafeMoon to create the impression of market activity, a practice known as wash trading.
The SEC's complaint, filed in the U.S. District Court for the Eastern District of New York, charges Defendants with violating the registration and anti-fraud provisions of the Securities Act of 1933 and the anti-fraud provisions of the Securities Exchange Act of 1934.
The SEC's investigation was conducted by John Lucas, with the assistance of John Crimmins, Pamela Sawhney, Sejal Bhakta, and John Marino. It was supervised by Deborah A. Tarasevich, Mr. Tenreiro, and Mr. Hirsch. The SEC's litigation will be led by Dean M. Conway and Oren Gleich, under the supervision of James Connor.
The SEC appreciates the assistance of the U.S. Attorney's Office for the Eastern District of New York, which filed a parallel criminal action, and the FBI.
华盛顿特区--(新闻档案公司,2023年11月1日)——美国证券交易委员会今天指控SafeMoon LLC、其创始人凯尔·纳吉、SafeMoon US LLC以及两家公司的首席执行官约翰·卡罗尼和首席技术官托马斯·史密斯通过未经注册出售加密资产证券SafeMoon实施大规模欺诈计划。根据美国证券交易委员会的投诉,被告承诺 “安全地登上月球”,但他们没有带来利润,反而消灭了数十亿美元的市值,从该项目中撤回了价值超过2亿美元的加密资产,并挪用了投资者资金供个人使用。
美国证券交易委员会执法部加密资产和网络部门(CACU)负责人戴维·赫希说:“去中心化金融声称可以提供透明度和可预测的结果,但未注册的发行缺乏法律要求的披露和问责制,它们吸引了像凯尔·纳吉这样的骗子,他们利用这些漏洞以牺牲他人为代价致富。”
根据美国证券交易委员会的投诉,在销售SafeMoon Token时,纳吉向投资者保证,资金已被安全锁定,包括被告在内的任何人都无法提取,而资金则存放在SafeMoon的流动性池中,这是一系列提供流动性以促进资产交易的投资者资金。但是,正如所指控的那样,流动资金池的很大一部分从未被锁定,被告挪用了数百万美元购买麦克拉伦汽车、奢侈旅行、豪宅和其他东西。
CACU副负责人豪尔赫·滕雷罗说:“我们敦促投资者继续在这一领域格外谨慎,因为欺诈者利用加密资产的受欢迎程度来承诺天文数字利润,而往往只会坠毁。”
美国证券交易委员会的投诉称,从2021年3月12日至4月20日,SafeMoon的价格飙升了55,000%以上,市值超过57亿美元,之后其价格暴跌了近50%,当时公众在2021年4月20日得知SafeMoon的流动资金池没有按声称的锁定。据称,在这次暴跌之后,Karony和Smith使用挪用的资产大量购买了SafeMoon,以支撑其价格并操纵市场。据称,Karony还使用他在交易平台上开设的账户来买入和卖出SafeMoon,以给人留下市场活动的印象,这种做法被称为虚假交易。
美国证券交易委员会向美国纽约东区地方法院提起的申诉,指控被告违反了1933年《证券法》的注册和反欺诈条款以及1934年《证券交易法》的反欺诈条款。
美国证券交易委员会的调查由约翰·卢卡斯在约翰·克里明斯、帕梅拉·索尼、塞贾尔·巴克塔和约翰·马里诺的协助下进行。它由黛博拉·塔拉塞维奇、特雷罗先生和赫希先生监督。美国证券交易委员会的诉讼将由迪恩·康威和奥伦·格莱奇领导,由詹姆斯·康纳监督。
美国证券交易委员会感谢提起平行刑事诉讼的纽约东区美国检察官办公室和联邦调查局的协助。