SEC Charges Two Companies in $130 Million Fraud Scheme Involving False Regulatory Filings

Key Takeaways

• $130 Million Alleged Fraud: The SEC charged BG Wealth Sharing Ltd and DSJ Exchange Pty Ltd with allegedly raising more than $130 million from tens of thousands of retail investors through a fraudulent cryptocurrency investment program.
• False SEC Filings: The companies allegedly submitted misleading Form ADV and Form D filings and presented them as evidence of SEC licensing or approval, although neither company was registered with the commission.
• Extraordinary Return Promises: BG Wealth allegedly promised monthly returns of at least 60%, claimed investors could double their money in 40 days and advertised trading signals with 99.6% accuracy.
• Fabricated Credentials and Investor Payments: The defendants allegedly used certificates bearing the SEC's seal, extensive investor communications and periodic payments to sustain confidence while misappropriating funds.

Deep Dive

BG Wealth Sharing promised investors they could double their money in 40 days. The company claimed its cryptocurrency trading signals were accurate 99.6% of the time and that investors faced no risk of losing their money. It also claimed to be the world's largest hedge fund, with the credentials of a registered investment adviser to support its business.

According to the Securities and Exchange Commission, the credentials were false, the promised returns were fraudulent and the company's purported trading partner was part of the same operation.

The SEC charged BG Wealth and DSJ Exchange with running an investment fraud that allegedly raised more than $130 million from tens of thousands of retail investors. The two foreign-operated companies, both incorporated in Colorado, used false regulatory filings and fabricated government certificates to convince investors that their businesses had received SEC approval, according to a complaint filed in the U.S. District Court for the Northern District of California.

The alleged scheme operated from at least October 2025 through June 2026, reaching investors in more than 40 states and multiple U.S. territories. BG Wealth promoted a purported wealth-sharing program built around cryptocurrency trading signals generated by technology it described as artificial intelligence. DSJ Exchange, meanwhile, presented itself as a licensed and secure trading platform where investors could deposit cryptocurrency and participate in the program.

The SEC alleges that neither company was registered with the commission. Yet both had submitted documents to its public filing system, and those documents became an important part of their efforts to attract investors.

BG Wealth filed a Form ADV claiming to be an exempt reporting adviser. DSJ Exchange submitted a Form D announcing a purported $100 million exempt securities offering. The companies then shared the filings with investors as evidence that the SEC had licensed or approved their operations. The filings were publicly accessible on the commission's website, lending the companies' claims an appearance of credibility. But submitting a Form ADV or Form D does not establish that the SEC has approved an investment program, and the commission alleges that both filings contained false information.

The companies reinforced those claims with fabricated registration certificates bearing the SEC's seal. According to the complaint, the documents were part of a broader effort to persuade investors that the purported trading operation was legitimate.

The investment program itself relied on a series of representations about how investors' money would be handled. BG Wealth directed participants to open accounts with DSJ Exchange, deposit cryptocurrency and enter alphanumeric trading signals distributed by BG Wealth. Investors were told that DSJ Exchange would trade only 1% of the capital in their accounts, pooling funds for transactions in the cryptocurrency market.

The trading platform displayed purported transactions, profits and growing account balances. Those figures gave investors a means of following what appeared to be the performance of their investments, although the SEC alleges that the underlying operation was fraudulent.

The companies also maintained frequent contact with participants. Their communications extended across social media, encrypted messaging channels, weekly live videoconferences and a mobile application.

Laura D'Allaird, chief of the SEC Enforcement Division's Cyber and Emerging Technologies Unit, said the number of channels used to reach investors demonstrated the planning behind the alleged scheme. The SEC also alleges that the companies made periodic payments to certain investors while misappropriating the remaining funds. D'Allaird described the payments as a Ponzi-like tactic that helped sustain the operation.

By June 2026, the companies had allegedly collected more than $130 million. The SEC has not established a final figure for investor losses, and the amount raised should not be confused with money recovered or a penalty imposed by the court.

The commission's complaint charges both companies with violating the antifraud provisions of the Securities Act of 1933 and the Securities Exchange Act of 1934. BG Wealth faces additional charges under Sections 204(a) and 207 of the Investment Advisers Act of 1940, concerning investment adviser records and filings and false statements in registration materials.

The SEC is seeking permanent injunctions against both defendants, disgorgement of allegedly ill-gotten gains with prejudgment interest and civil monetary penalties. It is also requesting conduct-based injunctions against BG Wealth.

The commission has removed BG Wealth's Form ADV and DSJ Exchange's Form D from its website. It has also pointed investors to existing warnings about fraudulent operators using exempt reporting adviser filings and false claims of SEC registration to solicit investments.

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