SEC Uncovers $14M Crypto Scam Using Fake AI Tips

Generally, You should be aware of a large-scale crypto fraud that allegedly swindled $14 million from retail investors using fake AI investment tips and WhatsApp investment clubs. Obviously, The U.S. Securities and Exchange Commission (SEC) has uncovered this scam. Normally, The SEC has charged three entities and four investment clubs for their roles in a scheme that targeted retail investors through social media. Interestingly, The entities, Morocoin Tech Corp., Berge Blockchain Technology Co. Ltd., and Cirkor Inc., along with AI Wealth Inc., Lane Wealth Inc., AI Investment Education Foundation Ltd., and Zenith Asset Tech Foundation, are accused of misappropriating over $14 million from mostly U.S.-based investors between January 2024 and January 2025.

Entities Charged

Apparently, The SEC has charged these entities for their involvement in the scam. Usually, The scam began with social-media advertisements promising easy profits and advanced AI-generated investment advice. Naturally, Victims were then invited to join WhatsApp group chats where scammers, posing as financial experts, shared supposed AI-powered trading tips to build trust. Often, Once investors were convinced, they were encouraged to open accounts and deposit money on fake crypto trading platforms operated by the entities. Obviously, These platforms falsely claimed to be licensed and regulated.

How the Scam Operated

Normally, The investment clubs also promoted fake “Security Token Offerings,” which they claimed were linked to real companies. However, No such companies or offerings existed, and no actual trading took place on the platforms. Generally, When investors tried to withdraw their funds, they were asked to pay additional upfront fees—a common tactic to extract more money from victims. Eventually, All investor funds were misappropriated and funneled overseas through a complex network of bank accounts and crypto wallets.

SEC Statement

Obviously, Laura D’Allaird, chief of the SEC’s Cyber and Emerging Technologies Unit, stated that the scheme was a multi-step fraud designed to attract victims with social-media ads, build trust in group chats, and then convince them to invest in fake platforms where their money was stolen. Usually, The SEC continues to crack down on fraudulent schemes in the crypto space to protect investors. Apparently, This case serves as a reminder of the importance of vigilance when dealing with investment opportunities, especially those promoted through social media and group chats.

AI’s Role in Fraud

Interestingly, The article also highlights the increasing use of AI in fraudulent activities, including deep-fake videos of well-known figures endorsing bogus investment schemes and AI tools used to bypass KYC checks and forge customer-support conversations. Normally, You should be aware of these tactics to avoid falling victim to such scams. Generally, The use of AI in fraud is becoming more common, and investors should be cautious when dealing with investment opportunities that seem too good to be true.

Takeaway

Obviously, This case serves as a reminder of the importance of vigilance when dealing with investment opportunities, especially those promoted through social media and group chats. Usually, You should do your research and verify the authenticity of any investment opportunity before investing. Apparently, The SEC continues to crack down on fraudulent schemes in the crypto space to protect investors. Normally, You can protect yourself by being aware of the common tactics used by scammers and taking steps to verify the authenticity of any investment opportunity.