Published
3 months ago on
January 30, 2024
Table of Contents
- HyperFund Fraud Unveiled
- Misappropriation of Funds
- Involvement Of Other “Characters”
- Legal Actions Against HyperVerse Leaders
The U.S. Securities and Exchange Commission (SEC) has charged HyperVerse founders with crypto fraud after their alleged Ponzi Scheme stole nearly $2 billion from investors.
HyperFund Fraud Unveiled
US authorities have exposed a $1.9 billion cryptocurrency Ponzi fraud orchestrated by leaders of HyperVerse, a scheme known as HyperFund. Criminal charges filed by the Department of Justice and a related civil action by the SEC reveal a fraudulent enterprise that preyed on investors through fake crypto mining operations.
The SEC lawsuit targets Sam Lee, an Australian residing in the UAE, and Brenda "Bitcoin Beutee" Chunga from Maryland. The duo allegedly lured investors with promises of profits from non-existent crypto asset mining operations. Instead of delivering on these promises, the accused diverted funds for personal gain.
Misappropriation of Funds
According to the SEC, Chunga misappropriated approximately $3.7 million for personal use, including extravagant expenditures on a BMW, designer clothing, a $1.2 million home in Maryland, and a $1.1 million condo in Dubai. Meanwhile, Lee allegedly directed $140,000 in digital funds to a wallet under his control, further indicating HyperVerse's fraudulent nature.
The SEC claimed,
“With no legitimate revenue, regulators claim investor withdrawals were paid with deposits from newer victims.”
Involvement Of Other “Characters”
The SEC complaint revealed that HyperVerse employed a fake CEO, a Thai TV presenter known as Steven Reece Lewis, who gave a speech during its launch. This deceptive move was part of a larger scheme where new investor deposits funded withdrawals without any legitimate source of revenue.
In a parallel development, Rodney Burton, also known as "Bitcoin Rodney," was also arrested by the SEC earlier in January for his alleged involvement in the same fraudulent investments. The US Internal Revenue Service brought forward claims of Burton's complicity in Lee and Chunga's schemes, highlighting substantial commissions earned by funneling over $7.85 million into fraudulent HyperFund accounts.
Legal Actions Against HyperVerse Leaders
The US District Court in Maryland indicted Lee and Chunga on January 25, charging them with conspiracy to commit wire fraud through the crypto Ponzi scheme. Simultaneously, the SEC pursued legal action, seeking the return of ill-gotten gains. Chunga, already agreeing to a settlement, faces future deal restrictions and undisclosed fines pending court approval.
The authorities are taking decisive action to hold the perpetrators accountable and seek restitution for defrauded investors.
Disclaimer: This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.
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