The U.S. Securities and Exchange Commission has accused two companies of raising more than $130 million from tens of thousands of retail investors through an alleged crypto investment fraud, using false regulatory filings and promises of risk-free trading returns.
According to Bitcoin Magazine, the SEC filed a complaint in the U.S. District Court for the Northern District of California against BG Wealth Sharing Ltd. and DSJ Exchange Pty Ltd. The agency alleges that the companies operated a so-called “wealth-sharing program” from at least October 2025 through June 2026.
The alleged program reached investors in more than 40 U.S. states and several U.S. territories. Participants were told that they could receive risk-free returns generated by signals linked to crypto-asset trading. The SEC says the companies used a combination of online promotion, investor communications and regulatory claims to attract participants.
Alleged use of false SEC filings
The SEC’s complaint says BG Wealth presented itself as the world’s largest hedge fund and claimed to be registered with the agency as an investment adviser. It also allegedly told investors that it had partnered with DSJ Exchange, which was described as a licensed and secure crypto trading platform.
The regulator disputes those representations. According to the complaint, neither the claimed SEC registration nor the description of the companies’ regulatory status was accurate. The agency alleges that the defendants submitted false Form ADV and Form D filings to the SEC. Because the documents were available on the regulator’s website, the companies allegedly used them as evidence that the agency had licensed or approved the businesses.
Form ADV is an investment-adviser filing, while Form D is generally used for certain securities offerings. The SEC said the filings have since been removed from its website. The agency also warned that scammers may use exempt reporting adviser filings to create a misleading appearance of legitimacy.
SEC describes a Ponzi-like tactic
Laura D’Allaird, chief of the SEC Enforcement Division’s Cyber and Emerging Technologies Unit, said in a statement that the alleged operation was well planned. The complaint says the companies used social media, encrypted messaging channels, weekly live video conferences and a mobile application to communicate with prospective and existing investors.
The SEC further alleges that the defendants displayed fake certificates carrying the SEC seal. The complaint also says some investors received periodic payments, which the agency described as a “Ponzi-like tactic,” while the remaining funds were misappropriated.
The allegations have not been established in court. The SEC charged both companies with violating the antifraud provisions of the Securities Act of 1933 and the Securities Exchange Act of 1934. BG Wealth also faces allegations of violating Sections 204(a) and 207 of the Investment Advisers Act of 1940.
The SEC is seeking permanent injunctions, repayment of allegedly misappropriated funds with prejudgment interest, and civil penalties against both companies. It is also seeking conduct-based injunctions against BG Wealth.
Investor warnings and current market picture
The SEC’s Office of Investor Education and Assistance has urged people considering crypto investments to check the background of the person or company offering the opportunity through Investor.gov. The agency said investors should be cautious about filings or documents presented as proof of government approval.
The SEC said it received assistance from the Alberta Securities Commission and securities authorities in Hawaii, Texas, Utah, Washington and Wisconsin, among other agencies.
Moneyiar market data at 12:58 p.m. on November 1, 2026, showed Bitcoin at $77,777.80, up 0.47% over 24 hours but down 3.2% over seven days. Compound was trading at $20.6570, with a 24-hour gain of 1.47% and a seven-day decline of 9.5%. RedStone stood at $0.135442, up 2.3% over 24 hours and down 5.21% over seven days, while Loaded Lions was priced at $0.00113883, up 0.07% on the day and down 4.05% over the week.
The enforcement action concerns alleged conduct by the two companies and is separate from the broader price movements shown in the market data. It highlights the importance regulators place on distinguishing genuine regulatory filings from documents or claims that merely appear to provide official endorsement.
