SEC Charges Texas Man in Alleged AI Crypto Trading Bot Fraud

The U.S. Securities and Exchange Commission has charged a Texas man with securities fraud for allegedly using an artificial intelligence-based crypto investment program to deceive investors, Cointelegraph reported on May 30.

The SEC alleges that Nathan Fuller raised $12.3 million from about 150 investors by touting false returns and a bogus AI trading system.

Fuller operated under the names Privvy Investments and Gateway Digital Investments from October 2022 through mid-2024. He promoted guaranteed returns of 40% to 50% within 30 to 45 days. He also allegedly claimed some investors could make more than 100% in as little as 21 days.

He told investors their money was protected by Federal Deposit Insurance Corp. coverage and surety bonds. Fuller also marketed a proprietary AI-based high-frequency arbitrage bot that he claimed generated profits across multiple crypto exchanges. The SEC said those claims were false and that the trading bot did not operate as advertised.

The agency's investigation found that at least $6.2 million of the $12.3 million raised was diverted to personal living expenses, while about $5.5 million was used to pay purported returns to earlier investors. The SEC said Fuller sustained the scheme by providing investors with false account statements and fabricated documents bearing company names.