The Securities and Exchange Commission (SEC) has filed charges against Jonathan Adam and Tanner Adam for orchestrating a $60 million Ponzi scheme that defrauded over 80 investors across the United States. The SEC, in a press release dated August 26, detailed how the brothers enticed investors by promising a monthly return of 13.5% on their investments.
The Adam brothers allegedly deceived investors by claiming that Jonathan had developed a cryptocurrency “bot” capable of identifying arbitrage opportunities on a trading platform. They also falsely assured investors that their funds would be placed in a lending pool, asserting that the investments were secure except in the event of a global market collapse.
In reality, the SEC revealed that the entire operation was a scam designed to exploit unsuspecting investors. Additionally, the commission noted that Jonathan Adam concealed a prior conviction for securities fraud from those he defrauded.
Rather than investing the funds as promised, Jonathan and Tanner Adam allegedly used the money to pay out supposed monthly returns to earlier investors, a classic Ponzi scheme tactic. They also spent millions on personal luxuries, including a down payment and installments on a $30 million condominium in Miami and $480,000 on luxury vehicles.
On Monday, the SEC announced that it had secured emergency relief to freeze the brothers’ assets. The charges were filed in the U.S. District Court for the Northern District of Georgia, and the SEC also brought charges against the brothers’ companies, GCZ Global and Triten Financial Group, for violations of federal securities laws related to fraud. The Adam brothers did not contest the asset freeze.
In addition to freezing their assets, the SEC is seeking a permanent injunction against Jonathan and Tanner Adam, the disgorgement of all ill-gotten gains, and civil penalties.
