The U.S. Securities and Exchange Commission (SEC) recently outlined charges against a pair of siblings, alleging they defrauded retail investors out of over $124 million through two unregistered fraudulent securities offerings.
Per the SEC’s complaint, the agency alleges from June 2017 through the present, John and JonAtina (Tina) Barksdale offered and sold Ormeus Coin to investors on crypto trading platforms – and from June 2017 to April 2018, the Barksdales offered and sold subscription packages that included Ormeus Coin and an investment in a crypto trading program via a multi-level marketing business called Ormeus Global.
The complaint alleges at events, in produced materials, and on Ormeus Coin’s website, the defendants falsely claimed that Ormeus Coin was supported by one of the largest crypto mining operations in the world, even though they abandoned the mining operations three years ago after generating less than $3 million in total mining revenue.
The SEC alleges the defendants falsely stated Ormeus Coin had a $250 million crypto mining operation, was producing $5.4 million to $8 million per month in mining revenues, and arranged for a public website to display a wallet of an unrelated third party showing more than $190 million in assets as of November 2021, even though the Ormeus wallets were worth less than $500,000.
Through the complaint, the SEC alleges the Barksdales manipulated Ormeus Coin’s price and misused millions of dollars of investor funds for personal expenses.
The complaint charges the Barksdales with violating the federal securities laws and seeks injunctive relief, disgorgement plus interest, and civil penalties, per authorities.
“We allege that the Barksdales acted as modern-day snake-oil salesmen, using social media, promotional websites, and in-person roadshows to mislead retail investors for their own personal benefit,” SEC Division of Enforcement Associate Director
Melissa Hodgman said.