On September 15, the U.S. SEC (Securities and Exchange Commission) charged a crypto advisor with a fraud case, after the advisor collected close to $4.3 million from four investors.
The SEC accused Gabriel Edelman of defrauding investors by selling securities and saying to them that he would invest their money in digital assets through his two companies, Edelman Blockchain Advisors LLC and Creative Advancement LLC.
Key points in the SEC Fraud Case
Instead, Gabriel allegedly used most of the funds for personal needs and only a tiny portion of the funds to repay clients early and “promote their ever-larger investments” in a “Ponzi-like manner,” according to the lawsuit.
The complaint states that out of the $4.9 million he raised, “at most” $447,300 was spent on crypto assets, and the remaining amount, i.e., at least $1.5 million, Edelman kept for himself.
The SEC also expressed that three of the investors were over age and all investors were US citizens who were “quite unknowledgeable regarding digital assets.”
According to the lawsuit, since 2020, Edelman lived in Spain but also resided in New York between 2017 and 2021 and allegedly executed the accused securities fraud.
According to the complaint filed in 2021 in the United States District Court for the Southern District of New York, Edelman had previously been mentioned in a complaint filed by a financial services company for which Gabriel had previously worked, as well as a New Jersey resident and two firms.
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