Verify a decision

{"actor":"system:backfill","investigation_id":"0f5291fa-19e9-4b52-a525-50034155b5f1","kind":"publish","page_slug":"privvy-investments-nathan-fuller","published_at":"2026-06-14T23:27:34.617Z","sequence_num":1,"snapshot":{"content_type":"investigation","entity_name":"Privvy Investments (Nathan Fuller)","sections":[{"content":"On May 28, 2026, the U.S. Securities and Exchange Commission filed a civil complaint against Nathan Fuller in the U.S. District Court for the Southern District of Texas (Houston). The complaint charges Fuller with violating Sections 5(a), 5(c), 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. The SEC's Fort Worth Regional Office and Cyber and Emerging Technologies Unit led the investigation. The agency seeks permanent injunctions, disgorgement of ill-gotten gains with prejudgment interest, and civil penalties. The complaint names Fuller individually as the sole founder and sole member of Privvy Investments LLC.","heading":"SEC Enforcement Action (2026)","severity":"critical","sources":[{"credibility":1,"name":"SEC Litigation Release LR-26558: Nathan Fuller","type":"regulatory","url":"https://www.sec.gov/enforcement-litigation/litigation-releases/lr-26558"},{"credibility":2,"name":"CoinDesk: SEC sues Texas man over $12.3 million alleged crypto scheme built on fake AI trading bots","type":"news_article","url":"https://www.coindesk.com/business/2026/05/30/sec-sues-texas-man-over-usd12-3-million-alleged-crypto-scheme-built-on-fake-ai-trading-bots"},{"credibility":2,"name":"The Block: SEC sues Privvy founder over $12.3 million crypto scheme as AI bots turn out to be neither","type":"news_article","url":"https://www.theblock.co/post/403118/sec-sues-privvy-founder-over-12-3-million-crypto-scheme-as-ai-bots-turn-out-to-be-neither"}]},{"content":"According to the SEC complaint, from at least October 2022 through mid-2024, Fuller offered and sold joint-venture interests in an alleged cryptocurrency trading operation through Privvy Investments LLC and under the assumed business names Privvy Investments and Gateway Digital Investments. Fuller allegedly told investors he had built proprietary AI-based trading bots that would execute high-frequency arbitrage trades across cryptocurrency platforms by identifying and exploiting small price discrepancies between exchanges. Fuller allegedly promised returns of 40% to 50% within 30 to 45 days, and in some cases reportedly promised guaranteed profits exceeding 100% in as little as 21 days. The SEC alleges the bots did not function as advertised: any code that existed lacked genuine AI capabilities and lacked the stop-loss functionality Fuller claimed. Only approximately $380,000, roughly 3% of total investor funds raised, was ever used to purchase cryptocurrency, and those trades generated no profit.","heading":"Alleged Scheme: Fake AI Trading Bots","severity":"critical","sources":[{"credibility":2,"name":"Investment News: SEC sues Texas man over alleged $12.3 million AI crypto scheme","type":"news_article","url":"https://www.investmentnews.com/regulation-legal-compliance/sec-sues-texas-man-over-alleged-123-million-ai-crypto-scheme/266827"},{"credibility":2,"name":"CoinDesk: SEC sues Texas man over $12.3 million alleged crypto scheme built on fake AI trading bots","type":"news_article","url":"https://www.coindesk.com/business/2026/05/30/sec-sues-texas-man-over-usd12-3-million-alleged-crypto-scheme-built-on-fake-ai-trading-bots"},{"credibility":2,"name":"Yahoo Finance: SEC says Texas man used fake AI crypto bots in $12.3 million investor scheme","type":"news_article","url":"https://finance.yahoo.com/markets/crypto/articles/sec-says-texas-man-used-070500713.html"}]},{"content":"The SEC alleges that Fuller misappropriated at least $6.2 million of the approximately $12.3 million raised for personal expenses and used approximately $5.5 million to make Ponzi-like payments to earlier investors to maintain the appearance of a functioning scheme. Personal expenditures alleged by the SEC include the purchase of a home valued at approximately $1 million (purchased for his ex-wife, who was involved in business operations), gambling trips, collectible trading cards, travel, and a Jeep vehicle. According to bankruptcy court findings, Fuller's ex-wife had an operational role in Privvy Investments.","heading":"Misappropriation of Investor Funds","severity":"critical","sources":[{"credibility":1,"name":"DOJ Office of Public Affairs: Debtor Who Led Crypto Investment Scheme Denied Bankruptcy Discharge","type":"regulatory","url":"https://www.justice.gov/opa/pr/debtor-who-led-crypto-investment-scheme-denied-bankruptcy-discharge"},{"credibility":2,"name":"Investment News: SEC sues Texas man over alleged $12.3 million AI crypto scheme","type":"news_article","url":"https://www.investmentnews.com/regulation-legal-compliance/sec-sues-texas-man-over-alleged-123-million-ai-crypto-scheme/266827"},{"credibility":2,"name":"Cryptopolitan: Privvy Investments customers win as court blocks $12.5M crypto Ponzi operator's escape","type":"news_article","url":"https://www.cryptopolitan.com/privvy-investments-court-blocks-escape/"}]},{"content":"The SEC alleges Fuller employed an extensive pattern of deception to sustain investor confidence and delay withdrawal demands. Fuller allegedly fabricated account statements showing fictitious profits and created correspondence from non-existent entities. Among the fabricated entities identified in the complaint: 'Texas Guarantors & Securities' (alleged to be a fictitious insurer invented by Fuller), and 'Digital Currency Capital Group' (an invented entity with a name resembling a real crypto firm). Fuller allegedly took a genuine $2 million general-liability insurance policy and altered the certificate to falsely show $5 million in professional-liability coverage. Fuller also allegedly fabricated a claim that investor funds were protected by surety bonds, FDIC coverage, and a Texas money-transmitter license, none of which existed. As investors attempted to withdraw funds in June 2024, Fuller allegedly created a fake firm called 'Blockchain Audit Solutions' and used an AI text-generation tool (ChatGPT) to draft a phony letter telling investors their accounts had been moved to that entity and required 'KYC verification' before payouts could occur. Fuller also built a fake application that displayed phantom account balances to investors.","heading":"Fabricated Documentation and Fictitious Entities","severity":"critical","sources":[{"credibility":2,"name":"Investment News: SEC sues Texas man over alleged $12.3 million AI crypto scheme","type":"news_article","url":"https://www.investmentnews.com/regulation-legal-compliance/sec-sues-texas-man-over-alleged-123-million-ai-crypto-scheme/266827"},{"credibility":2,"name":"The Block: SEC sues Privvy founder over $12.3 million crypto scheme","type":"news_article","url":"https://www.theblock.co/post/403118/sec-sues-privvy-founder-over-12-3-million-crypto-scheme-as-ai-bots-turn-out-to-be-neither"},{"credibility":2,"name":"FX News Group: SEC brings charges against owner of Privvy Investments in connection with $12.3M crypto scheme","type":"news_article","url":"https://fxnewsgroup.com/forex-news/cryptocurrency/sec-brings-charges-against-owner-of-privvy-investments-in-connection-with-12-3m-crypto-scheme/"}]},{"content":"In October 2024, following civil suits filed by victims in Texas state court and the appointment of a receiver to seize his assets, Fuller filed for Chapter 7 bankruptcy individually and through Privvy Investments LLC, in the Bankruptcy Court for the Southern District of Texas. During those proceedings, Fuller admitted that he 'operated Privvy as a Ponzi scheme and fabricated documentation to advance the scheme.' He also confessed to giving false testimony and falsifying bankruptcy documents to obstruct the Chapter 7 trustee, and to concealing assets from creditors. On August 1, 2025, the bankruptcy court entered a default judgment. On September 10, 2025, the court officially denied Fuller a discharge of over $12.5 million in listed debts, meaning he remains personally liable to creditors. The U.S. Trustee Program, Region 7 (Houston), prosecuted the discharge-denial action. U.S. Trustee Kevin Epstein stated: 'Fraudsters seeking to whitewash their schemes will not find sanctuary in bankruptcy.'","heading":"Texas Bankruptcy Proceedings and Admission","severity":"critical","sources":[{"credibility":1,"name":"DOJ Office of Public Affairs: Debtor Who Led Crypto Investment Scheme Denied Bankruptcy Discharge","type":"regulatory","url":"https://www.justice.gov/opa/pr/debtor-who-led-crypto-investment-scheme-denied-bankruptcy-discharge"},{"credibility":2,"name":"Decrypt: US Trustee Calls Out 'Dishonest Debtor' in $12.5M Crypto Bankruptcy Case","type":"news_article","url":"https://decrypt.co/338920/us-trustee-dishonest-debtor-12-5m-crypto-bankruptcy-case"},{"credibility":2,"name":"Cryptopolitan: Privvy Investments customers win as court blocks $12.5M crypto Ponzi operator's escape","type":"news_article","url":"https://www.cryptopolitan.com/privvy-investments-court-blocks-escape/"}]},{"content":"According to the SEC complaint, approximately 150 investors across nine U.S. states and two foreign countries were solicited and defrauded through Privvy Investments between October 2022 and mid-2024. The scheme used joint-venture interests as the investment vehicle. Fuller marketed the opportunity under at least three business names: Privvy Investments LLC (the formal legal entity), Privvy Investments (a trade name), and Gateway Digital Investments (an assumed business name). Specific states or countries affected have not been named in available public filings as of June 2026.","heading":"Investor Profile and Geographic Reach","severity":"high","sources":[{"credibility":2,"name":"CoinDesk: SEC sues Texas man over $12.3 million alleged crypto scheme built on fake AI trading bots","type":"news_article","url":"https://www.coindesk.com/business/2026/05/30/sec-sues-texas-man-over-usd12-3-million-alleged-crypto-scheme-built-on-fake-ai-trading-bots"},{"credibility":1,"name":"SEC Litigation Release LR-26558: Nathan Fuller","type":"regulatory","url":"https://www.sec.gov/enforcement-litigation/litigation-releases/lr-26558"}]},{"content":"The Privvy Investments case has been identified by multiple industry observers as one of the SEC's most significant 2026 enforcement actions targeting the use of artificial intelligence claims to legitimize fraudulent crypto investment products. The pattern of deploying AI branding to attract investors to nonexistent or non-functional trading infrastructure has been described in industry reporting as 'AI washing.' The SEC's Cyber and Emerging Technologies Unit led the investigation, signaling institutional focus on this category of fraud. The case follows a broader trend documented by crypto security researchers of AI-branded crypto scams rising sharply in frequency in 2025 and 2026.","heading":"AI-Washing Context and Regulatory Significance","severity":"high","sources":[{"credibility":2,"name":"The Block: SEC sues Privvy founder over $12.3 million crypto scheme as AI bots turn out to be neither","type":"news_article","url":"https://www.theblock.co/post/403118/sec-sues-privvy-founder-over-12-3-million-crypto-scheme-as-ai-bots-turn-out-to-be-neither"},{"credibility":2,"name":"Crypto Briefing: SEC charges Texas resident over alleged $12.3M crypto fraud using AI trading bots","type":"news_article","url":"https://cryptobriefing.com/sec-charges-nathan-fuller-crypto-fraud-ai-bots/"}]},{"content":"As of June 2026, the SEC civil complaint filed May 28, 2026, in the U.S. District Court for the Southern District of Texas remains active. No criminal charges have been publicly announced as of the date of this investigation. Fuller's bankruptcy discharge was denied on August 1, 2025, leaving him personally liable for debts exceeding $12.5 million. A receiver was appointed in Texas state court proceedings initiated by victims prior to the bankruptcy filing. The SEC seeks permanent injunctions, disgorgement of profits with prejudgment interest, and civil penalties; no settlement or consent order has been publicly announced.","heading":"Current Legal Status","severity":"high","sources":[{"credibility":1,"name":"SEC Litigation Release LR-26558: Nathan Fuller","type":"regulatory","url":"https://www.sec.gov/enforcement-litigation/litigation-releases/lr-26558"},{"credibility":1,"name":"DOJ Office of Public Affairs: Debtor Who Led Crypto Investment Scheme Denied Bankruptcy Discharge","type":"regulatory","url":"https://www.justice.gov/opa/pr/debtor-who-led-crypto-investment-scheme-denied-bankruptcy-discharge"}]}],"sources_used":[{"credibility":1,"name":"SEC Litigation Release LR-26558: Nathan Fuller","type":"regulatory","url":"https://www.sec.gov/enforcement-litigation/litigation-releases/lr-26558"},{"credibility":1,"name":"DOJ Office of Public Affairs: Debtor Who Led Crypto Investment Scheme Denied Bankruptcy Discharge","type":"regulatory","url":"https://www.justice.gov/opa/pr/debtor-who-led-crypto-investment-scheme-denied-bankruptcy-discharge"},{"credibility":2,"name":"CoinDesk: SEC sues Texas man over $12.3 million alleged crypto scheme built on fake AI trading bots","type":"news_article","url":"https://www.coindesk.com/business/2026/05/30/sec-sues-texas-man-over-usd12-3-million-alleged-crypto-scheme-built-on-fake-ai-trading-bots"},{"credibility":2,"name":"The Block: SEC sues Privvy founder over $12.3 million crypto scheme as AI bots turn out to be neither","type":"news_article","url":"https://www.theblock.co/post/403118/sec-sues-privvy-founder-over-12-3-million-crypto-scheme-as-ai-bots-turn-out-to-be-neither"},{"credibility":2,"name":"Investment News: SEC sues Texas man over alleged $12.3 million AI crypto scheme","type":"news_article","url":"https://www.investmentnews.com/regulation-legal-compliance/sec-sues-texas-man-over-alleged-123-million-ai-crypto-scheme/266827"},{"credibility":2,"name":"Decrypt: US Trustee Calls Out 'Dishonest Debtor' in $12.5M Crypto Bankruptcy Case","type":"news_article","url":"https://decrypt.co/338920/us-trustee-dishonest-debtor-12-5m-crypto-bankruptcy-case"},{"credibility":2,"name":"Cryptopolitan: Privvy Investments customers win as court blocks $12.5M crypto Ponzi operator's escape","type":"news_article","url":"https://www.cryptopolitan.com/privvy-investments-court-blocks-escape/"},{"credibility":2,"name":"Yahoo Finance: SEC says Texas man used fake AI crypto bots in $12.3 million investor scheme","type":"news_article","url":"https://finance.yahoo.com/markets/crypto/articles/sec-says-texas-man-used-070500713.html"},{"credibility":2,"name":"FX Leaders: SEC Charges Privvy Founder Nathan Fuller Over $12.3M AI Bot Crypto Ponzi Scheme","type":"news_article","url":"https://www.fxleaders.com/news/2026/05/31/sec-charges-privvy-founder-nathan-fuller-over-12-3m-ai-bot-crypto-ponzi-scheme/"},{"credibility":2,"name":"FX News Group: SEC brings charges against owner of Privvy Investments in connection with $12.3M crypto scheme","type":"news_article","url":"https://fxnewsgroup.com/forex-news/cryptocurrency/sec-brings-charges-against-owner-of-privvy-investments-in-connection-with-12-3m-crypto-scheme/"},{"credibility":2,"name":"Crypto Briefing: SEC charges Texas resident over alleged $12.3M crypto fraud using AI trading bots","type":"news_article","url":"https://cryptobriefing.com/sec-charges-nathan-fuller-crypto-fraud-ai-bots/"},{"credibility":2,"name":"Bitcoin.com News: The Bots Were Fake: SEC Sues Privvy Founder Over $12.3 Million Crypto Scheme","type":"news_article","url":"https://news.bitcoin.com/sec-privvy-fuller-ai-bot-fraud/"},{"credibility":2,"name":"Daily Hodl: Alleged Fraudster Orchestrates $12,500,000 Crypto Trading Scheme","type":"news_article","url":"https://dailyhodl.com/2026/06/10/alleged-fraudster-orchestrates-12500000-crypto-trading-scheme-uses-funds-for-ponzi-like-payments-and-personal-expenses-sec/"}],"summary":"Privvy Investments LLC was a Texas-based cryptocurrency investment company operated by Nathan Fuller of Cypress, Texas, that the SEC alleges raised approximately $12.3 million from roughly 150 investors between October 2022 and mid-2024 using false claims about proprietary AI-powered trading bots. Fuller admitted in September 2025 Texas bankruptcy proceedings that the scheme was a Ponzi operation, and the SEC filed a civil complaint against him on May 28, 2026, in the U.S. District Court for the Southern District of Texas, alleging misappropriation of at least $6.2 million for personal use and $5.5 million in Ponzi-style payouts to earlier investors.","timeline":[{"date":"2022-10-01","event":"Nathan Fuller begins soliciting investors through Privvy Investments LLC, offering joint-venture interests in an alleged AI-powered crypto arbitrage trading program.","source":"SEC Litigation Release LR-26558","source_url":"https://www.sec.gov/enforcement-litigation/litigation-releases/lr-26558"},{"date":"2024-06-01","event":"As investors attempt to withdraw funds, Fuller allegedly creates fictitious entity 'Blockchain Audit Solutions' and uses AI-generated correspondence to delay payouts, claiming accounts require KYC re-verification.","source":"Investment News: SEC sues Texas man over alleged $12.3 million AI crypto scheme","source_url":"https://www.investmentnews.com/regulation-legal-compliance/sec-sues-texas-man-over-alleged-123-million-ai-crypto-scheme/266827"},{"date":"2024-07-01","event":"Scheme winds down; Fuller has raised approximately $12.3 million total and deployed only about $380,000 (3%) into actual crypto trading.","source":"CoinDesk: SEC sues Texas man over $12.3 million alleged crypto scheme","source_url":"https://www.coindesk.com/business/2026/05/30/sec-sues-texas-man-over-usd12-3-million-alleged-crypto-scheme-built-on-fake-ai-trading-bots"},{"date":"2024-10-01","event":"Fuller files for Chapter 7 bankruptcy individually and through Privvy Investments LLC in the Bankruptcy Court for the Southern District of Texas, following civil suits filed by victims and appointment of a receiver.","source":"DOJ Office of Public Affairs: Debtor Who Led Crypto Investment Scheme Denied Bankruptcy Discharge","source_url":"https://www.justice.gov/opa/pr/debtor-who-led-crypto-investment-scheme-denied-bankruptcy-discharge"},{"date":"2025-08-01","event":"Bankruptcy Court for the Southern District of Texas enters default judgment against Fuller after he admits operating Privvy as a Ponzi scheme and fabricating documentation, and after he is found to have given false testimony and falsified bankruptcy filings.","source":"DOJ Office of Public Affairs: Debtor Who Led Crypto Investment Scheme Denied Bankruptcy Discharge","source_url":"https://www.justice.gov/opa/pr/debtor-who-led-crypto-investment-scheme-denied-bankruptcy-discharge"},{"date":"2025-09-10","event":"U.S. Trustee Program Region 7 (Houston) announces the court's denial of Fuller's bankruptcy discharge for over $12.5 million in listed debts, citing his admitted operation of Privvy as a Ponzi scheme and obstruction of bankruptcy proceedings.","source":"DOJ Office of Public Affairs: Debtor Who Led Crypto Investment Scheme Denied Bankruptcy Discharge","source_url":"https://www.justice.gov/opa/pr/debtor-who-led-crypto-investment-scheme-denied-bankruptcy-discharge"},{"date":"2026-05-28","event":"SEC files civil complaint against Nathan Fuller in the U.S. District Court for the Southern District of Texas, alleging violations of the Securities Act of 1933 and Securities Exchange Act of 1934 in connection with the $12.3 million Privvy Investments scheme.","source":"SEC Litigation Release LR-26558","source_url":"https://www.sec.gov/enforcement-litigation/litigation-releases/lr-26558"},{"date":"2026-05-30","event":"Major crypto and financial press report the SEC complaint, widely covering the 'AI washing' angle and the prior bankruptcy admission as corroborating evidence.","source":"CoinDesk: SEC sues Texas man over $12.3 million alleged crypto scheme built on fake AI trading bots","source_url":"https://www.coindesk.com/business/2026/05/30/sec-sues-texas-man-over-usd12-3-million-alleged-crypto-scheme-built-on-fake-ai-trading-bots"}]},"v":1}