Bitcoin

SEC Charges Brit In Bitcoin Fraud

In a cryptocurrency case that could have repercussions across the pond, the Securities and Exchange Commission (SEC) last week (June 30) charged a U.K. citizen with securities fraud tied to bitcoin.

The Guardian reported that the SEC charges allege that Renwick Haddow, a U.K. citizen who lives in New York, duped investors into placing money with him with a scam centered on a phony bitcoin trading platform — and also deceived them with another enterprise, the flexible workspace firm known as Bar Works.

The SEC, as noted by Andrew Calamari, director of the agency’s New York office, found that Haddow “created two trendy companies and misled investors into believing that highly qualified executives were leading them to quick profitability. In reality, Haddow controlled the companies from behind the scenes, and they were far from profitable.” And there were no executives.

Via the chimerical Bitcoin Store, Haddow said investors could hold and trade the currency and that the company had generated millions of dollars in gross sales — when in fact it had done nothing of the sort and had conducted no operations whatsoever.

The Guardian also stated that Haddow’s investors had put as much as $37 million in Bar Works, which said it offered workspaces based in eateries — but, according to the SEC, “primarily sold leases coupled with sub-leases that together functioned like investment notes.”

As many as two dozen investors from China have filed suit in that country looking for $3 million USD in repayments.

From the bitcoin ruse, Haddow allegedly bilked $5 million in funds and diverted them to offshore accounts in Mauritius and Morocco.

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