Retail investors were lured into fraudulent investment schemes through WhatsApp chat groups and other social media venues by entities posing as legitimate investment advisors, the U.S. Securities and Exchange Commission (SEC) alleges.
In a pair of complaints filed Tuesday in the U.S. district court for the Southern District of New York (SDNY), the SEC alleged that two sets of companies — Cryptoaiml Ltd. and Cryptoaiml Capital Foundation, and TSAI Pro Ltd. and TSAI Capital Foundation — engaged in “investment confidence scams” to defraud investors after building relationships with them online.
In its complaint against the Cryptoaiml entities, the regulator alleged that between August 2024 and March 2025, the firms impersonated investment professionals in WhatsApp groups, issuing trading tips that purported to be AI generated, and directing investors to open accounts on a fake trading platform.
“Once investors and clients opened these accounts and funded them with their assets, investors were provided with ‘trading signals’ which they followed and resulted in their accounts reflecting large trading profits,” the SEC alleged.
However, the platform wasn’t real, there wasn’t any actual trading, and investors’ profits were fake too.
“In reality, the Cryptoaiml platform was simply a vehicle created and used by defendants to misappropriate investor and client funds,” the compliant said — adding that investors were also charged advance fees to gain access to their purported trading profits.
In total, the SEC alleged that investors were defrauded out of US$12.5 million in that case. It also alleged that the TSAI entities duped investors out of US$2.8 million with a similar scam that offered investors access to fake trading bots to be used on its fake trading platform.
“Although the methods used to bilk innocent investors in these fraudulent investment scams varied, the goal was the same – promise potential investors outsized returns, claim that they were legitimate entities regulated by the SEC, and then steal their money,” said David Woodcock, director of the SEC’s division of enforcement, in a release.
The allegations have not been proven.