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The U.S. Securities and Exchange Commission (SEC) has filed an emergency action against BKCoin, described as a $100 million digital asset Ponzi scheme, and its founder Kevin Kang.

The securities watchdog obtained an asset freeze, appointment of a receiver, and other emergency relief against the Miami-based company, it announced on Monday.

Kang, a 33-year-old New Yorker, launched BKCoin in November 2018. He touted it as an investment company focused on digital assets, claiming that BKCoin could generate returns for investors through separately managed accounts and five private funds.

The SEC alleges that Kang disregarded this purported fund structure, comingled user assets, and grew the company into a giant Ponzi scheme. He channeled over $3.6 million to paying off early investors with latter-stage investors’ money in a Ponzi fashion.

Kang also dipped his hands into the company’s coffers for his personal uses, spending over $370,000 to purchase a New York apartment, pay for expensive vacations and tickets to sporting events, among other things.

To avoid detection, Kang doctored the accounting records and inflated bank balances, authorities said. He also lied to investors that the company’s books had been audited by a “top four auditor” while none of the company’s funds had received any audit.

In one case, Kang used the “audited by a top four auditor” lie to lure an investor who, shortly after receiving the marketing materials, deposited over $1.3 million in one of BKCoin’s funds.

“As we allege, investors entrusted their money to the defendants to trade in crypto assets. Instead, the defendants misappropriated their money, created false documents, and even engaged in Ponzi-like conduct. This action highlights our continued commitment to protecting investors and uprooting fraud in all securities sectors, including the crypto asset arena,” Eric I. Bustillo, the SEC’s Regional Director in Miami, commented.

The regulator has charged Wang with nine counts, including multiple counts of violating the Securities Act and the Advisers Act, as well as unjust enrichment. It is demanding a permanent injunction against the defendants, an asset freeze and repatriation, appointment of a receiver, disgorgement, and prejudgment interest.

Watch: Law & Order Regulatory Compliance for Blockchain & Digital Assets

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