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SEC case targets Fuller
The U.S. Securities and Exchange Commission charged Texas resident Nathan Fuller with a fraudulent cryptocurrency trading scheme that raised about $12.3 million from roughly 150 investors through entities including Privvy Investments between October 2022 and mid-2024.
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The SEC alleges Fuller marketed the program as an AI-driven, high-frequency crypto arbitrage “trading robot” promising returns of “over 40 to 50 percent” within 30 to 45 days and “guaranteed” profits of more than 100 percent in as little as 21 days.
According to the complaint, Fuller allegedly misappropriated at least $6.2 million for personal expenses and used approximately $5.5 million to make Ponzi-like payouts to earlier investors.
The SEC says the vaunted AI trading robot “did not operate as advertised,” and instead of deploying most of the capital into legitimate cryptocurrency markets, Fuller allegedly diverted millions for personal use.
The agency filed the case in federal court in Texas and is seeking permanent injunctions, disgorgement of ill-gotten gains plus interest, and civil penalties.
AI hype and fake protections
Investigators allege Fuller falsely assured investors that their funds were protected by insurance and bonding arrangements, including claims tied to a surety bond, FDIC insurance, and a professional liability insurance policy.
The SEC’s complaint says Fuller’s pitch included proprietary AI-based trading bots that he claimed would conduct high-frequency arbitrage trading across crypto platforms, but “Fuller’s bots did not function as represented,” according to the complaint.
To keep investors calm and delay scrutiny, the SEC alleges Fuller sent fake account statements and fabricated correspondence from fictitious entities.
In the SEC’s account, the scheme relied on promises that some investors could earn returns of 40% to 50% within 30 to 45 days and guaranteed profits exceeding 100% in as little as 21 days.
The SEC is also seeking disgorgement of allegedly ill-gotten gains and civil penalties, as it frames the case as part of a broader crackdown on crypto fraud that uses AI branding to lure retail investors.
Broader enforcement ripple
The SEC’s complaint describes a pattern in which AI claims are paired with short payout windows and false assurances about investor protection, while the alleged mechanics include forged account statements and fabricated documents to conceal losses.
Cointelegraph notes that the Fuller case comes as the combination of AI and crypto has opened new frontiers for bad actors, including a separate $14 million scheme that leaned on AI branding and used WhatsApp groups to promise profits from AI-generated trading tips.
The same Cointelegraph report says that last month the SEC charged crypto executive Donald Basile and two companies he controlled with raising roughly $16 million from hundreds of investors through false claims tied to a crypto token called Bitcoin Latinum.
In its 2025 enforcement results, the SEC acknowledged that since fiscal year 2022 it brought 95 actions and imposed $2.3 billion in penalties for book-and-record violations that “identified no direct investor harm” and “produced no investor benefit or protection.”
For Fuller’s case specifically, the SEC is seeking permanent injunctions, disgorgement of ill-gotten gains, and civil penalties, with the allegations centered on $12.3 million raised, about 150 investors, and funds allegedly diverted into personal expenses and Ponzi-like payments.
