SEC fines NanoBit $5M for crypto fraud via WhatsApp
6.7 Regulation The SEC ordered NanoBit to pay $5M in fines for deceiving investors with fake ICOs and misappropriating funds through WhatsApp and social media scams.
The U.S. Securities and Exchange Commission (SEC) has finalized its case against the cryptocurrency platform NanoBit, resulting in a court order for the defendants to pay over $5 million in fines. The SEC alleged that, from September 2023 to June 2024, NanoBit and its associates posed as financial professionals in WhatsApp groups and on social media to gain investors' trust. They promoted fake initial coin offerings (ICOs) and falsely claimed that an affiliate was an SEC-registered broker. No legitimate transactions occurred on the NanoBit platform; instead, more than $2 million was diverted to bank accounts in Hong Kong, and hundreds of thousands of dollars in crypto assets were misappropriated. This marks the SEC’s first enforcement action involving relationship investment scams. The agency also issued an investor alert, warning about the risks of investment scams conducted through social networks and messaging apps.
