The US Securities and Exchange Commission has filed fraud expenses in opposition to a UK citizen accused of bilking the traders of a bitcoin startup.
According to court documents filed right now, the SEC accused Renwick Haddow of deceptive stakeholders who purchased into two firms he based: Bitcoin Shop Inc., which was marketed as a platform for buying and selling bitcoin, and Bar Works, a co-working area firm akin to WeWork. Concurrently, the US Attorney’s Office for the Southern District of New York can be urgent expenses in opposition to Haddow.
The SEC alleged that Haddow, who resides in New York, misrepresented key components in regards to the firm’s operation and the background of senior executives of Bitcoin Store Inc. who, in response to the assertion, “do not appear to exist” in an try and to attract potential traders.
Haddow – who the SEC mentioned created a broker-dealer agency, known as InCrowd Equity, with out registering with the company – was additional accused of diverting funds raised from traders to financial institution accounts held exterior of the nation.
The SEC said today in a launch:
“Haddow allegedly diverted more than 80 percent of the in funds raised by the broker-dealer for the Bitcoin Store, and sent more than $4 million from the Bar Works bank accounts to one or more accounts in Mauritius and $1 million to one or more accounts in Morocco.”
In court docket paperwork, the SEC famous that Haddow had beforehand obtained an eight-year disqualification within the UK from working because the director of an organization, a ban stemming from his involvement with a agency known as Branded Leisure plc.
The SEC additionally alleged that pretend identities had been employed by the accused companies. The court docket paperwork famous that the CEO of the startup is known as Gordon Phillips, who appeared in promotional movies for the service. According to a LinkedIn web page, the profiled particular person used to work for HSBC in London and Hong Kong, in addition to Deutsche Bank.
Yet the company alleged that Gordon Phillips “never worked for HSBC or Deutsche Bank” and it believes the identify is a fictitious one.
Earlier this month, New York enterprise publication Crain’s reported on the collapse of Bar Works, noting that the agency is the topic of an investigation by the Federal Bureau of Investigation in addition to two investor-led lawsuits. A report in January, from The Real Deal, first urged that pretend identities had been employed.
The web site www.bitcoinstore.global seems to be linked to the scheme. A press release revealed on the location in July 2015 confirmed that Bitcoin Store Inc., the precise identify of the entity charged by the SEC, was making an attempt to subject a convertible promissory notes with a coupon of eight% each year in an effort to elevate $1.825 million.
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