SEC Files Fraud Charges Against Unicoin for $110 Million Crypto Scheme

TLDR

• SEC charges Unicoin and executives for misleading over 5,000 investors to raise $110 million
• CEO Alex Konanykhin, board member Silvina Moschini, and former CIO Alex Dominguez face fraud allegations
• General counsel Richard Devlin agreed to pay $37,500 penalty without admitting wrongdoing
• SEC claims Unicoin falsely stated tokens were registered and backed by valuable real estate assets
• Case continues despite SEC’s recent retreat from other crypto enforcement actions under Trump administration

The U.S. Securities and Exchange Commission has filed charges against New York-based cryptocurrency company Unicoin and three of its top executives for allegedly defrauding investors of more than $110 million. The SEC complaint, filed in the Southern District of New York on Tuesday, accuses the company of misleading over 5,000 investors through false claims about its crypto asset offerings and company stock.

The lawsuit names CEO Alex Konanykhin, board member Silvina Moschini, and former Chief Investment Officer Alex Dominguez as defendants. They allegedly promoted “rights certificates” tied to Unicoin tokens using false or misleading statements about asset backing and registration status.

The company’s general counsel, Richard Devlin, was also charged for making misleading statements in private placement memoranda. Devlin has agreed to pay a $37,500 penalty and accept a permanent injunction without admitting wrongdoing.

Mark Cave, associate director in the SEC’s Division of Enforcement, stated in the complaint that “Unicoin and its executives exploited thousands of investors with fictitious promises that its tokens, when issued, would be backed by real-world assets including an international portfolio of valuable real estate holdings.”

According to the SEC, the real estate assets owned by Unicoin were worth “a mere fraction” of what the company claimed. This discrepancy forms a central part of the fraud allegations.

Misleading Marketing Campaign

The SEC alleges that Unicoin conducted a widespread marketing campaign to attract investors. The company placed advertisements in airports, taxis, and on television, presenting their offerings as “next generation” secure investments.

Regulators claim Unicoin falsely stated that its tokens were registered with the SEC. The company also allegedly misrepresented the total amount raised, claiming $3 billion in rights certificate sales when the actual figure was just over $110 million.

The complaint further alleges that Konanykhin personally sold nearly 38 million certificates to investors who were otherwise barred from participating in the offering.

Legal Battle Amid Changing Regulatory Landscape

The case against Unicoin comes at a time when the SEC, under the Trump administration, has retreated from several high-profile crypto enforcement actions. Recent cases against major industry players like Coinbase, Ripple, Kraken, and Consensys have been dropped, signaling a shift away from the more aggressive regulatory stance taken by the previous administration.

Speaking to Decrypt in April, Konanykhin vowed to contest the charges in court.

“I fully intend to win this case in the courtroom,” he said. “It’s grotesque that the most compliant crypto company in the U.S. remains the only one being persecuted by the SEC.”

Konanykhin has claimed that the lawsuit does not represent the views of the current SEC leadership. He characterized the action as being “driven by rogue officials left over from the Gensler administration who are trying to cover themselves by bullying us into a false admission of guilt.”

In a Miami Herald op-ed published in April, Konanykhin expressed hope that Unicoin would be the next company to be freed from SEC investigation. He pointed to a dozen other crypto companies that have already been released from regulatory scrutiny under the new administration.

The SEC is seeking injunctive relief, disgorgement, and civil penalties against all named defendants in the case. The agency is also pursuing officer-and-director bans for the three senior executives.

The complaint states that investors have been put at risk due to the alleged fraudulent practices. The investigation into Unicoin and its executives is ongoing, with the SEC continuing to gather evidence to support its claims.

Konanykhin has been contacted for comment on the latest developments, but no response had been received at the time of publication.

The SEC filed the charges on Tuesday in the Southern District of New York, seeking penalties against all defendants named in the case.