Connect with us

Hi, what are you looking for?


Online Crypto Course Founder Faces SEC Charges in $1.2 Million Fraud Case

The founder of the American Bitcoin Academy was charged with crypto fraud by the Securities and Exchange Commission on February 2.

In a press release published by the SEC, the agency noted that Brian Sewell, founder of American Bitcoin Academy, convinced his students to invest in a crypto hedge fund he said would use artificial intelligence to generate returns.

Sewell’s Crypto Fraud Scheme

Sewell urged his students to invest in the Rockwell Fund, a hedge fund he claimed would utilize AI and cryptocurrency-related trading strategies for profit. Despite receiving approximately $1.2 million from 15 students, Sewell did not launch the fund.

Instead of starting the fund, Sewell converted the investments into Bitcoin, later suffering the loss of those funds when his digital wallet was compromised.

The fraud scheme led the SEC to take decisive action. The regulatory agency accused Sewell and his company, Rockwell Capital Management, of fraud, leading to a settlement in which they neither admitted nor denied the charges.

“Among other things, he falsely claimed that his investment strategies would be guided by his own ‘artificial intelligence’ and ‘machine learning’ technology which, like the fund itself, never existed,” said Gurbir S. Grewal, director of the SEC’s Division of Enforcement.

Rockwell Capital Management is set to pay $1.6 million, while Sewell will contribute $223,229 to resolve the crypto fraud charges brought by the SEC.

The SEC said that Sewell sent students a 16-slide investor pitch deck containing numerous misrepresentations and omissions about the fund.

Within the pitch deck, Sewell falsely asserted that he had earned degrees in data science from Johns Hopkins University and Stanford University.

Sewell additionally informed investors that he had previously overseen a crypto hedge fund, claiming to have transformed an initial $250,000 into $9 million.

“Sewell’s representations were false,” the SEC’s complaint read. “As Sewell was well aware, he had no prior experience managing a hedge fund.”

The SEC’s Ongoing Scrutiny of Cryptocurrency Practices

The enforcement action represents the most recent in a series of cases initiated by the SEC related to digital assets. SEC Chair Gary Gensler has consistently warned investors about the alleged prevalence of fraud in the cryptocurrency industry.

Last week, members of Congress sought to eliminate Staff Accounting Bulletin 121 (SAB 121) from the SEC. The bulletin imposes restrictions on banks intending to retain their clients’ crypto assets, mandating the inclusion of these assets on the banks’ balance sheets.

Chair @GaryGensler’s SAB 121 has virtually blocked banks from serving as custodians of digital assets. Today, @RepWileyNickel, @SenLummis, and I introduced resolutions to repeal @SECGov‘s terrible bulletin.

SAB 121’s days are numbered – it’s time for it to go!

— Rep. Mike Flood (@USRepMikeFlood) February 1, 2024

Representatives Mike Flood and Wiley Nickel, along with Senator Cynthia Lummis, introduced a resolution under the Congressional Review Act to revoke the SEC’s SAB 121. The resolution seeks to formally disapprove of the accounting rule, asserting that it lacks legal force.

The post Online Crypto Course Founder Faces SEC Charges in $1.2 Million Fraud Case appeared first on Cryptonews.

Your information is secure and your privacy is protected. By opting in you agree to receive emails from us. Remember that you can opt-out any time, we hate spam too!



Bitcoin Price Prediction Bitcoin’s latest rally to $66,400, showcasing nearly 6% uptick within a mere 24 hours, becomes a focal point for analysts and...


The Financial Supervisory Commission (FSC) of Taiwan has announced its intention to propose a new draft of digital asset regulations for the country in...


Fallen crypto exchange FTX has opened its claim window for creditors to retrieve their crypto assets. However, the exchange has faced criticism on social...


The Bitcoin price just hit new record highs in euros and British pounds. BTC/EUR crept above €60,000 during early Monday trade, before briefly surpassing...


The price of Bitcoin (BTC) now trades at an all-time high against the Canadian dollar roughly seventeen months after the nation’s leader slammed digital...


Here is our weekly collection of digital asset listing and delisting, trading pair-related announcements by crypto exchanges that we found last week and today....

You May Also Like

Financial Advisors


Financial Advisors


Financial Advisors

The humongous outbreak of the dreaded coronavirus has brought about a groundbreaking change in what the world perceived as ‘normal’. With an estimated 280,391,189...

Disclaimer: Respect, its managers, its employees, and assigns (collectively "The Company") do not make any guarantee or warranty about what is advertised above. Information provided by this website is for research purposes only and should not be considered as personalized financial advice. The Company is not affiliated with, nor does it receive compensation from, any specific security. The Company is not registered or licensed by any governing body in any jurisdiction to give investing advice or provide investment recommendation. Any investments recommended here should be taken into consideration only after consulting with your investment advisor and after reviewing the prospectus or financial statements of the company.

Copyright © 2024 Respect Investment. All Rights Reserved.