The U.S. Securities and Exchange Commission (SEC) has filed investment fraud charges against the founder of a purported Bitcoin platform and a chain of co-working spaces. The Bitcoin fraud charges allege that the fraudster bilked investors out of millions of dollars.

U.K. Fraudster Runs Unregistered Broker-Dealer

The SEC alleges that U.K. citizen Renick Haddow created an unregistered broker-dealer, using sales representatives to sell securities in Bitcoin Store Inc. and Bar Works Inc. The latter is a chain of co-working spaces located in former bars and restaurants.

Under all federal securities laws, all broker-dealers are required to be registered.
In the case of both companies, the charges allege that Haddow and his representatives misrepresented the companies to investors. Documents cited senior executives who do not appear to exist and inflated or falsified key facts about operations. In the SEC complaint, it alleges that Bitcoin Store never had any operations nor generated the gross sales it boasted.

Bitcoin Fraud Charges for Misrepresentation

The money Haddow raised from investors allegedly was diverted to personal accounts, including one located in Mauritius and others in Morocco. In total, more than 80 percent of the funds received by the broker-dealer for the Bitcoin Store were diverted, totaling up to $5 million.

In the case of Bar Works, the company sold leases coupled with sub-leases that together functioned like investment notes. Haddow claimed the company was “vibrant” and profitable, encouraging investors to pour more than $37 million into the company. Once received, the money was diverted from company accounts.

In addition to SEC action, the U.S. Attorney’s Office for the Southern District of New York has also announced criminal charges against Haddow.

Concerned about Bitcoin Fraud?

If you invested with Bitcoin or think you may be involved in Bitcoin fraud, you may have certain legal rights that require your immediate attention.

Call an Investment Fraud Attorney Today

If you are looking for an attorney to review your rights and options, the securities lawyers at Dimond Kaplan & Rothstein, P.A. have recovered more than $100 million from banks and brokerages firms for their wrongful actions.

With offices in Los AngelesNew YorkWest Palm Beach and Miami, our securities attorneys represent clients nationwide and may be able to help you recover your investment losses.

Contact an attorney at Dimond Kaplan & Rothstein, P.A. today to schedule an appointment or consultation to review your rights and options.

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