Atlanta, Saturday, September 7, 2024- The U.S. Securities and Exchange Commission (SEC) has filed charges against two brothers for allegedly orchestrating a $60 million Ponzi scheme.
Jonathan Adam and Tanner Adam are accused of defrauding over 80 investors through a bogus cryptocurrency investment scheme.
The complaint, filed on August 26 in the Northern District of Georgia, alleges that the Adams brothers promised investors monthly returns of 13.5% by claiming their crypto bot could identify arbitrage opportunities across various platforms.
Investors were led to believe their funds would be used in a lending pool for flash loans and trades executed in a single blockchain transaction.
However, the SEC’s investigation revealed the bot was fictitious. Instead of trading, the Adams brothers reportedly misappropriated $53.9 million of the $61.5 million raised, using the funds to finance lavish lifestyles, including luxury vehicles and a $30 million condominium.
The SEC has secured emergency asset freezes for the brothers’ companies, GCZ Global LLC and Triten Financial Group LLC. Jonathan Adam has been charged with violating federal securities laws and has invoked the Fifth Amendment in response to a subpoena.
Tanner Adam did not respond to the SEC’s subpoena, failing to produce requested documents or testify.
The SEC seeks permanent injunctions against the Adams brothers and their companies, the return of all investor funds, and civil penalties. The case highlights a broader trend of Ponzi schemes dominating crypto fraud, despite an overall decline in scam-related crypto activity.
