SEC Alleges WhatsApp Investment Clubs and Fake AI Tips Fueled $14 Million Crypto Scam

The U.S. Securities and Exchange Commission filed a complaint this week alleging that operators of unregistered “investment clubs” used WhatsApp groups, social‑media advertising and fabricated AI investment tips to lure retail investors into sham cryptocurrency trading platforms and misappropriate about $14 million in funds, according to the agency’s civil enforcement action.

How the scheme worked, according to the SEC

The SEC’s complaint describes a multi‑step fraud that began in 2024 when defendants running groups with names such as AI Wealth, Lane Wealth, AIIEF and Zenith recruited prospective investors through advertisements on social media and invited them into private WhatsApp groups presented as investment clubs staffed by purported financial professionals, the SEC said[1].

Inside the groups, members received frequent trading recommendations the defendants claimed were produced by artificial‑intelligence systems; those recommendations were used to build credibility and trust among retail members, the complaint alleges[1].

Members were then directed to deposit funds and trade on three cryptocurrency trading platforms—Morocoin, Berge and Cikor—that the complaint says were controlled by the same fraudsters. Rather than providing legitimate trading or custodial services, the platforms accepted investor deposits and the operators transferred assets out of investor control, the SEC alleges[1].

Money flows and alleged laundering

After victims deposited crypto into unhosted wallets, the defendants allegedly moved the assets across blockchains and through intermediaries to obscure their origin, including transfers tied to individuals in China, Malaysia and Myanmar, the SEC said[1].

The complaint also alleges that at least 27 domestic bank accounts were used to convert crypto proceeds into fiat and wire funds overseas, a step the SEC identifies as part of the defendants’ effort to hide and extract investor money[1].

Defendants and relief the SEC seeks

The SEC named the clubs AI Wealth, Lane Wealth, AIIEF and Zenith as defendants and identified the platforms Morocoin, Berge and Cikor as the trading venues to which victims were directed. The filing says the entities never registered with the SEC and that some of the individuals running the scheme were located in China, Malaysia and Hong Kong[1].

In its complaint the Commission seeks a cease‑and‑desist order, disgorgement of ill‑gotten gains, civil penalties and a jury trial to pursue those remedies[1]. The agency’s Cyber and Emerging Technologies Unit characterized the fraud as causing “devastating consequences” for retail investors and highlighted the use of group chats and false AI claims to build trust[1].

Context and enforcement trends

The SEC’s action fits a broader pattern of regulators targeting crypto frauds that use social media and messaging apps to recruit victims and cloak operations with claims of advanced technology such as AI. Enforcement authorities have increasingly focused on scams that exploit retail investors’ willingness to follow tips in private channels and to use unhosted wallets and offshore venues that reduce traceability[1][2].

Industry reporting and subsequent analyses note that schemes using messaging platforms can rapidly scale recruitment while creating an appearance of community‑based legitimacy that makes victims more likely to follow directions to move assets off established exchanges and into opaque wallets controlled by scammers[2][3].

What investors should watch for

• Unsolicited recruiting via social ads or private chats: The SEC emphasizes that ads leading to private group invites are a common tactic in these cases[1].
• Claims of AI‑generated investment tips: Fraudsters may assert sophisticated technology produces guaranteed winning trades—an indicator to treat claims skeptically[1].
• Requests to use unhosted wallets or obscure trading platforms: Directions to move assets into wallets you control (where custodial protections are absent) or to little‑known platforms are high‑risk signs[1].

Responses and next steps

The complaint does not indicate that the named investment clubs or platform operators have responded to the allegations; the SEC sought court relief and civil remedies in its filing[1]. Financial institutions and law enforcement are typically involved in tracing flows and freezing assets when possible, but the complaint documents that some funds were moved through multiple jurisdictions and accounts, complicating recovery[1].

Retail investors who believe they may have been victimized by similar schemes should preserve communications and transaction records and consult counsel or law enforcement to evaluate recovery options and report the activity to regulators.

Reporting and regulatory significance

The SEC’s action signals continued emphasis on policing crypto‑related frauds that exploit new communication channels and technological buzzwords to build credibility with unsophisticated investors. The agency’s pursuit of disgorgement and civil penalties in civil court underscores its dual goal of seeking investor relief and deterrence[1][2].

As digital assets and AI‑related marketing converge, regulators say vigilance is needed from platforms, financial institutions and investors to spot manipulative recruiting and the movement of funds into unregulated venues that can facilitate theft and laundering[1][2].

Reporting for this article relied on the SEC complaint and contemporaneous enforcement coverage.