SEC Files Charges Against Geosyn Mining, Accuses Its Co-Founders Of $5.6M Fraud
In Brief
SEC brought charges against Geosyn Mining and its co-founders, pertaining their involvement in fraudulent securities offering.
US Securities and Exchange Commission (SEC) brought charges against cryptocurrency mining and hosting company Geosyn Mining and its co-founders, Caleb Ward and Jeremy McNutt. The charges pertain to their involvement in an unregistered and fraudulent securities offering.
Initially, the company informed its supporters of its intention to acquire, manage, and run cryptocurrency miners, subsequently allocating the mined cryptocurrency assets, including Bitcoin, to them for a fee.
However, the firm deceived 60 investors, raising nearly $5.6 million from 2021 to 2022. Furthermore, the company neglected to inform its new contributors that previous investors had not received mining machines as promised and also failed to fulfill the services it detailed in the initial documents.
The SEC further alleged that the firm’s founders periodically distributed Bitcoin to the supporters in an attempt to conceal operational challenges and shortcomings. While the company has raised $320,000 from mining activities, it distributed a total of $354,500 in Bitcoin to investors. Additionally, one of the founders, Jeremy McNutt, reportedly had to personally acquire Bitcoin to cover the shortfall.
Moreover, the filing detailed that the enterprise deceitfully asserted the existence of profitable contracts with electricity providers, thereby committing fraud. Reportedly, the actual costs were significantly higher than what was conveyed to the backers.
SEC Files Charges Against Geosyn Mining For Securities Law Violations
In late 2022, Geosyn Mining’s financial situation began to deteriorate. Caleb Ward accused Jeremy McNutt of embezzlement, which caused the latter to leave and relinquish his ownership interest. Last year, Caleb Ward reached out to the investors, informing them that the firm would settle their outstanding Bitcoin payments at a later date.
The SEC‘s filing accused the company founders of violating the anti-fraud and securities-registration provisions outlined in the federal securities laws and requested a permanent injunction, aiming to secure the reimbursement of the alleged misappropriations and impose penalties on the founders.
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About The Author
Alisa, a dedicated journalist at the MPost, specializes in cryptocurrency, zero-knowledge proofs, investments, and the expansive realm of Web3. With a keen eye for emerging trends and technologies, she delivers comprehensive coverage to inform and engage readers in the ever-evolving landscape of digital finance.
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Alisa, a dedicated journalist at the MPost, specializes in cryptocurrency, zero-knowledge proofs, investments, and the expansive realm of Web3. With a keen eye for emerging trends and technologies, she delivers comprehensive coverage to inform and engage readers in the ever-evolving landscape of digital finance.
