The US Securities and Exchange Commission (SEC) has charged seven organizations with "investor confidence fraud" that defrauded victims of at least $14 million between January 2024 and January 2025.

According to the US regulator, the scam began with targeted social media ads. These ads invited users to join exclusive WhatsApp "investment clubs," which were marketed as educational and high-yield investment communities.

Once inside the "club," victims were gradually drawn into the scheme. Individuals posing as experienced financial professionals or so-called "professors" shared fictitious success stories, fake screenshots of profitable trades, and claims of AI-powered investment strategies. The goal was simple: gain trust before asking for money. After establishing trust, victims were asked to open accounts on three supposed trading platforms: Morocoin Tech Corp., Berge Blockchain Technology Co. Ltd., and Cirkor Inc. The regulator clarified that these platforms were fictitious, did not conduct real trading activities, and were unlicensed. The victims were then offered to participate in a listing of "security tokens," which was also fictitious.

The scam was uncovered after the "investors" unsuccessfully attempted to withdraw their funds. The SEC reported that the stolen funds were transferred through foreign bank accounts and cryptocurrency wallets.

The SEC is currently seeking permanent injunctions, civil penalties, and disgorgement of ill-gotten gains.