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The United States Securities and Exchange Commission (SEC) has charged a Texas man with orchestrating a digital asset trading scheme that allegedly raised around $12.3 million through multiple false claims, including promises of guaranteed profits exceeding 100% and the use of artificial intelligence-based trading bots.
In a complaint filed with the U.S. District Court for the Southern District of Texas on May 28, the SEC accused Nathan Fuller of Cypress, Texas, of allegedly using “various misrepresentations and omissions” to lure approximately 150 investors to his digital asset trading scheme, a company called Privvy Investments.
According to the SEC, from at least October 2022 through mid-2024, Fuller solicited investors to sign joint venture agreements and made false and misleading statements to persuade them to participate in his scheme. Among the false promises was that investors, who had a passive role in the venture, would generate returns of 40-50% within 30 to 45 days and guaranteed profits exceeding 100% in as little as 21 days.
If investors or potential investors raised doubts, Fuller allegedly allayed their concerns with false statements that he held a money-transmitter license, that investor funds were secured by a surety bond, and that investor funds were insured by the Federal Deposit Insurance Corporation (FDIC).
Another of Fuller’s promises was that his company would use proprietary AI-based trading bots to engage in high-frequency arbitrage trading on digital asset trading platforms. However, the SEC alleged that Fuller’s bots did not function as represented, arguing that “to the extent they functioned at all, their code did not include stop-loss or AI functionality.”
Furthermore, Fuller allegedly did not even use the vast majority of investor funds to trade in digital assets, as he said he would. Instead, the SEC said he only used approximately $380,000—about 3% of the investment funds raised—to purchase digital assets, and he did so without using AI bots.
“These crypto asset transactions did not reflect the automated high-frequency arbitrage trading that Fuller promised, and they generated no profit,” said the SEC.
According to the filing, Fuller also misappropriated at least $6.2 million of investor funds for personal expenses, “spending investor funds on an approximately $1 million house, gambling, trading cards, travel, a Jeep, and other personal expenses.”
In addition, he allegedly used approximately $5.5 million of investor funds to make “Ponzi-like payments,” while lulling and placating investors using fake account statements and fabricated correspondence from phony entities.
The SEC is seeking permanent injunctions, disgorgement of ill-gotten gains with prejudgment interest, and civil penalties against Fuller.
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English (US) · 