The Securities and Exchange Commission has charged Ryan Ginster with conducting two unregistered and fraudulent securities offerings that raised more than $3.6m in cryptocurrency from retail investors.
The SEC’s complaint claims that, in the period from 2018 to 2021, Ginster raised approximately $3.6m in Bitcoin through two online platforms – MyMicroProfits.com and Social Profimatic.
The complaint also said that Ginster, of Corona, California, deceived investors in both offerings about, among other things, how their funds would be used, “because he misappropriated at least $1m of the funds raised to pay personal expenses (including tax, housing, and credit card bills)”.
Violating antifraud provisions of Securities Act of 1933 and 1934
Michele Wein Layne, Regional Director of the SEC’s Los Angeles Regional Office said Ginster allegedly engaged in a fraudulent scheme raising millions in cryptocurrency using online investment programs and then converted the cryptocurrency for his own benefit.
“Individuals who hide behind the anonymity of cryptocurrency transactions to defraud investors should expect that the SEC will trace their illegal activity and hold them accountable for their actions,” he said.
The complaint charges Ginster with violating the antifraud and registration provisions of the Securities Act of 1933 and the Securities Exchange Act of 1934, and seeks permanent injunctions, disgorgement with prejudgment interest, and civil penalties.
The SEC’s Office of Investor Education and Advocacy has issued an Investor Alert warning investors about digital asset and cryptocurrency investment scams. Investors can find additional information about investments involving digital assets on Investor.gov.