(HedgeCo.Net) The Securities and Exchange Commission has charged Alexander Elbanna and three entities that he owned and controlled with engaging in a fraudulent scheme involving unregistered offers and sales of crypto asset securities called “DWE” and “BPC.” The SEC also charged Elbanna and one of his entities with fraudulent private offers and sales of equity securities.
According to the SEC’s complaint, between February 2018 and April 2021, Elbanna founded and promoted, in succession, three separate business enterprises: Digital World Exchange, LLC, Boostedpro LLC, and D.W. Exchange, LLC. Each of these businesses allegedly included a proposed crypto asset trading platform and an “in-house exchange token” or crypto asset security whose value purportedly depended on Elbanna’s successful launch of the proposed trading platform. To induce investors to purchase DWE and BPC, as well as equity securities in the corporate entity that issued DWE, the complaint alleges that Elbanna and his three entities made materially false and misleading statements to investors concerning Elbanna’s level of technological experience and wealth, the risks involved in the investment, and the operation of the associated crypto asset trading platform. As a result of this misconduct, the SEC’s complaint alleges that investors lost over $1 million.
The complaint, filed in the U.S. District Court for the Middle District of Florida, charges Elbanna and his three entities with violating Sections 5 and 17(a) of the Securities Act of 1933 and Section 10(b) of the Securities Exchange Act of 1934 and Rule 10b-5 thereunder. Each defendant, without admitting or denying the allegations, consented to a bifurcated settlement, agreeing to permanent injunctions against violating the charged provisions, conduct-based injunctions, and monetary relief in an amount to be determined by the court at a later date upon motion of the SEC. Elbanna further consented to an officer and director bar. The settlements are subject to court approval. The complaint also names Angela Elbanna as a relief defendant.
