The SEC charges a Texan for a 12.3 million crypto fraud

Under Gary Gensler, the SEC treated the crypto industry like a sheriff entering a saloon with his hand on the holster. With Paul Atkins, the atmosphere seems less suffocating for serious companies. However, the opening is not a rodeo without fences. When the scam smells like gunpowder, the regulator still draws.

The SEC Dismantles a Return Promise Too Good to Be True

The SEC accuses Nathan Fuller, a resident of Cypress in Texas, of raising about $12.3 million from 150 investors. According to the complaint filed in the Southern District of Texas, the case spans from October 2022 to mid-2024. Fuller acted through Privvy Investments LLC and under the trade names Privvy Investments and Gateway Digital Investments.

The case file is based on a well-known lure, repainted in the colors of artificial intelligence. Fuller allegedly promised returns of 40% to 50% in 30 to 45 days. Some investors even reportedly heard of guaranteed profits over 100% in just 21 days. 

To make the trap more appealing, he claimed to use proprietary AI bots capable of performing high-frequency arbitrage on crypto platforms.

The scene was further enhanced by false guarantees. The funds were said to be backed by a bond, insured by the FDIC, and protected by a professional policy. According to the SEC, none of this was true.

The Miracle Crypto Robots Would Hide an Old Ponzi Scheme

The SEC states that the bots did not work as announced. Behind the technical jargon, the regulator describes a much more classic scheme. Fuller allegedly embezzled at least $6.2 million for personal expenses. About $5.5 million were used to pay old investors, in a scheme similar to a Ponzi.

To maintain the appearance of diligence, Fuller allegedly sent fake account statements and fabricated correspondence. This kind of setup shows that the word “AI” sometimes becomes a marketing lasso. It captures investors who want to believe in a bright, fast, and invincible machine. 

Yet, the law remains simple: a false promise, a material omission, or an invented guarantee can trigger civil liability.

The SEC seeks permanent injunctions, the return of gains, and financial penalties. The regulator also reminds it has already pursued other cases involving crypto, WhatsApp, fake experts, and promises of AI trading.

The Numbers That Load the Legal Revolver

• $12.3 million were allegedly raised from investors;
• About 150 people are involved in the case;
• The promised returns sometimes reached 100% in 21 days;
• $6.2 million allegedly financed personal expenses;
• $5.5 million were used to pay old investors.

In the United States, the crypto hunt plays out before the SEC, judges, and federal court files. In France, the situation has sometimes taken a more violent turn. Crypto-related kidnappings have led to several arrests, proving that digital money can also erupt violently off the screens.