Crypto News – In a news release on Monday, the SEC stated that from June 2020 to early 2022, Xue Lee and Brenda Chunga, better known by their stage names Sam Lee and Bitcoin Beautee, respectively, raised approximately $1.7 billion from supporters worldwide.
HyperFund Founders Charged with Fraud by SEC
The SEC claimed that although Lee and Chunga portrayed HyperFund as a chance to engage in lucrative mining ventures, it was actually a pyramid scheme with no genuine sources of income and that Lee and Chunga “knew or were reckless in not knowing.” Investor money was lost when the project collapsed in 2022.
This case illustrates yet again how noncompliance in the crypto space facilitates schemes where promoters capitalize on the promise of easy money, without providing the detailed investor protection disclosures required by the registration provisions of the federal securities laws,
Chunga Pleads Guilty to the Charges
Lee and Chunga are accused by the SEC of breaking the federal securities laws’ anti-fraud and registration requirements in the complaint that was filed in federal district court in the District of Maryland. Lee and Chunga were additionally charged with crimes by the U.S. Attorney’s Office for the District of Maryland. Chunga has previously entered a guilty plea to wire fraud and conspiracy to commit securities fraud. Additionally, he consented to the charges being settled and to pay the court-determined amounts for disgorgement and civil penalties.