The Securities and Exchange Commission(SEC) has charged John and JonAtina(Tina) Barksdale with crypto fraud totalling more than $124M.
According to the press release, the siblings were charged for defrauding thousands of retail investors out of more than $124 million through two unregistered fraudulent offerings of securities employing a digital token called “Ormeus Coin.”
According to the complaint, the siblings have been selling the Ormeus Coin to investors since June 2017, when a multi-level marketing company named Ormeus Global was launched and operated until April 2018.
Ormeus Global sold subscription packages that included Ormeus Coin and a crypto trading investment platform.
The Barksdales siblings have also been accused of falsely claiming that the Ormeus Coin was backed by a $250 million crypto mining company with monthly profits ranging from $5.4 million to $8 million.
The siblings’ mining operations, on the other hand, concluded in 2019 with total revenue of only $3 million.
John Barksdale is also accused of holding worldwide roadshows to market the duo’s products. Tina Barksdale allegedly used YouTube, news releases, social media posts, and other promotional materials to advertise the services.
The Barksdales even arranged for a wallet from an unrelated party to be shown on a public website stating more than $190 million in assets as of November 2021, despite the Ormeus wallets being worth less than $500k.
The siblings are also accused of manipulating Ormeus Coin’s price and misusing millions of dollars in investor monies for personal needs.
Separate criminal charges have been filed against John Barksdale by the Attorney’s Office for the Southern District of New York.
The SEC is diligently hunting down crypto-related fraudsters and law breakers along with the rise in hype of the cryptocurrency sector. Last month the SEC charged BlockFi with failing to register the offers and sales of its retail crypto lending product. BlockFi in turn agreed to pay a $100M penalty to the SEC and announced the launch of BlockFi Yield, which would comply with SEC regulations.
