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Crime and Investigations

SEC Charges BitClout Founder with $257 Million Fraud

SEC Charges BitClout Founder with $257 Million Fraud

On July 30, the SEC and the US Attorney’s Office for the Southern District of New York filed charges against Nader Al-Naji, the founder of BitClout.

The SEC’s complaint alleges that Al-Naji raised $257 million through BitClout’s native token, BTCLT, without proper registration, and misappropriated part of these funds. The lawsuit also includes Decentralized Social (DeSo), another project by Al-Naji.

Specifically, the SEC accuses Al-Naji of using $7 million of investor money for personal luxuries, including renting a mansion in Beverly Hills and giving cash gifts to his family, contrary to his promise that such funds would not be used for personal compensation.

Additionally, the SEC alleges that Al-Naji misrepresented BitClout’s decentralization status, falsely claiming it was governed by no central authority while he managed it behind the scenes. Gurbir S. Grewal, SEC’s Division of Enforcement director, criticized Al-Naji for trying to evade regulations by pretending the project was decentralized.


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The complaint also names Al-Naji’s family and associated business entities as relief defendants, suggesting they benefited from the misused funds.

Author
Alexander Stefanov

Reporter at CoinsPress

Alex is an experienced finance journalist and a cryptocurrency and blockchain enthusiast. With over five years of experience covering the industry, he deeply understands the complex and constantly evolving world of digital assets. His insightful and thought-provoking articles provide readers with a clear picture of the latest developments and trends in the market. His passionate approach allows him to break down complex ideas into accessible and insightful content. Follow up on his content to be up to date with the most important trends and topics - stay ahead of the curve with CoinsPress.

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