As the US Securities Exchange Commission (SEC) intensifies its regulatory action against non-compliant individuals and businesses, the market regulators filed a fresh lawsuit against the prominent crypto investor Diana Mae Fernandez. In a December 28 report, the SEC accused the self-proclaimed crypto investor for engaging in multiple fraudulent activities.
Rise of Fraudulent Crypto Schemes
The regulators claimed that Fernadez promised to increase the customer’s value by investing their assets in crypto investment and other revenue-generating schemes. Under the initial agreement the crypto investors were assured the their funds will multiply after a given time.
The report promised the customers a 63% return on investment in cryptos, profits from luxury real estate, and income from private and publicly traded companies. However, instead of maximizing the value of customers’ assets, the executive noted that Fernandez pocketed the profits generated from crypto investment.
According to the SEC, the disgraced crypto investor generated approximately $ 364,000 from “The Self-Made Success” and “Diana Mae K., LLC. The Fernadez-led initiative comprised more than 20 investors and other industry leaders from church groups and social networking platforms.
The SEC noted that the embattled crypto investors promised the customers to generate measurable return on investment. Surprisingly, Fernandez failed to act as per the initial agreement and misused the customer’s funds.
The market regulators noted that Fernandez used the customers’ funds to meet her lavish lifestyle. However, the SEC described the Fernandez project as a Ponzi scheme since only the early investors benefited from the project.
The regulators noted that at the beginning of the project, the early investor received their payments as agreed.
SEC Take Potential Action Against Crypto Scammers
After more clients joined the Fernandez-led projects, the troubled crypto investor pocketed the returns generated from the investment. The report indicates that Fernandez used the customer’s funds to meet her daily expenses, including holidays, vacations, and lavish hotel stays.
Upon contacting the affected customers to inquire about the Fernandez projects, one of the clients described the self-made entrepreneur as a guru in matters concerning investment.
The customer claimed that Fernandez has over 15 years of experience in the investment and financial sector. He added that Fernandez leveraged his vast expertise to generate $100 million in 25 countries.
After analyzing the matter, the SEC noted that Fernandez used different strategies to trick the customers. The SEC observed that Fernandez advised her clients to transfer funds directly to her bank accounts and her PayPal account.
Based on the SEC findings, the regulators noted Fernandez exercises complete control over these accounts and manages the funds she receives. The regulators noted that Fernandez used the customer funds for personal gains, and the remaining amount was distributed among the few investors.
Investors Suffers Losses in Fraudulent Crypto Investments
The regulators noted that Fernandez spent the customers’ funds to meet for her holiday trips to Barcelona and Paris. The report indicates that the US prosecutors was the first to Fernandez case in early July to relevant authority.
A review of the Department of Justice (DOJ) filing demonstrated investors from Marion County and West Virginia fell for Fernandez’s trap. The DOJ noted that most affected investors invested over $300,000 in Fernandez projects.
The regulators noted that after investing customers’ funds in multiple projects, Fernandez failed to share the profits with the investors as agreed. Instead, Fernandez claimed that the dividends could not be paid now and used the funds to meet to her needs.
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