The U.S. Securities and Exchange Commission has charged two foreign-operated, Colorado-incorporated companies, BG Wealth Sharing Ltd. and DSJ Exchange Pty Ltd., with defrauding investors of more than $130 million through a crypto investment scheme. A complaint filed in the U.S. District Court for the Northern District of California alleges that from at least October 2025 through June 2026, the defendants induced tens of thousands of retail investors across more than 40 states and several U.S. territories to join a “wealth-sharing program.” Participants were promised risk-free returns generated by signals for crypto asset trading.
According to the SEC, BG Wealth falsely claimed to be the world’s largest hedge fund, misrepresented its registration as an investment adviser, and asserted a partnership with DSJ Exchange, which it described as a licensed and secure platform. The complaint alleges the companies submitted false Form ADV and Form D filings to the SEC, which were viewable on the agency’s website and shared with investors to create a false impression of regulatory approval. Laura D’Allaird, chief of the SEC Enforcement Division’s Cyber and Emerging Technologies Unit, stated that the alleged scheme utilized social media, encrypted messaging channels, weekly live videoconferences, and a mobile app to engage investors. The defendants allegedly displayed fake certificates bearing the SEC’s seal and made periodic payments to some investors, a tactic described as Ponzi-like, while misappropriating remaining funds.
The SEC charged both companies with violating antifraud provisions of the Securities Act of 1933 and the Securities Exchange Act of 1934. BG Wealth is additionally charged with violating Sections 204(a) and 207 of the Investment Advisers Act of 1940. The agency seeks permanent injunctions, disgorgement with prejudgment interest, civil penalties, and conduct-based injunctions against BG Wealth. The false filings have been removed from the SEC website, and the Office of Investor Education and Assistance has issued alerts warning about scammers using exempt reporting adviser filings to feign legitimacy. The investigation received assistance from securities regulators in Alberta, Hawaii, Texas, Utah, Washington, Wisconsin, and other jurisdictions.
This enforcement action highlights a sophisticated exploitation of public regulatory databases to manufacture credibility. By filing false Form ADV and Form D documents, the defendants leveraged the visibility of these records on the SEC website to deceive retail investors into believing they operated under legitimate oversight. This tactic underscores the vulnerability of relying solely on public filings for due diligence, particularly when bad actors can manipulate the system to project an aura of compliance without actual authorization.
The cross-jurisdictional nature of the fraud, spanning over 40 states and involving coordination with international bodies like the Alberta Securities Commission, demonstrates the global reach of modern crypto scams. The use of encrypted messaging and live video conferences indicates a shift toward high-engagement, community-driven fraud models that mimic legitimate institutional communication channels. Investors must recognize that presence in regulatory databases does not equate to endorsement or verification of business practices, necessitating independent verification through official channels such as Investor.gov.
