SEC files charges against CFO who embezzled money to invest in crypto

The U.S. Securities and Exchange Commission has filed fraud charges against a CFO who embezzled funds to put successful crypto, according to a Jan. 3 property release.

The accused — Cooper J. Morgenthau — served arsenic CFO of African Gold Acquisition Corp., which acted arsenic a peculiar intent acquisition (SPAC) institution that arranged mergers and acquisitions betwixt different companies.

Morgenthau’s full strategy progressive the theft of much than $5 cardinal betwixt June 2021 and July 2022. He initially embezzled $1.2 cardinal of funds straight from African Gold, past spent the stolen funds connected idiosyncratic expenses. He besides utilized the funds to commercialized crypto assets and securities including “meme stocks.”

Morgenthau past attempted to screen his losses by raising $4.7 cardinal done 2 SPAC bid called Strategic Metals Acquisition Corp. I and II. However, helium soon invested the wealth raised successful that process successful cryptocurrency erstwhile again.

Morgenthau’s mediocre investments and unrestrained spending led him to suffer each of the stolen funds by August 2022, according to earlier ineligible filings.

The SEC asserts that Morgenthau specifically violated antifraud provisions of national securities laws. He lied to auditors and accountants, falsified records astatine African Gold, and filed mendacious certifications with the SEC. He volition beryllium barred from serving successful definite enforcement positions and faces fiscal penalties which are inactive pending.

The U.S. Attorney’s Office for the Southern District of New York has besides announced parallel charges against Morgenthau.

The SEC has carried retired respective different cases related to crypto implicit the past year. In February 2022, it settled with BlockFi implicit an unregistered product. In October, it settled with Kim Kardashian implicit her endorsement of an ICO.

In December 2022, the SEC charged FTX associates Caroline Ellison and Gary Wang with fraud successful parallel charges with the Southern District of New York.

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