A federal judge in New York entered a $5.5 million default judgment against NanoBit Limited and five related defendants over an alleged relationship-investment scam built on a fake crypto trading platform.
The U.S. District Court for the Eastern District of New York ordered $5,518,902 in combined disgorgement, prejudgment interest, and civil penalties on June 16, the U.S. Securities and Exchange Commission (SEC) announced.
The agency alleged that from September 2023 to June 2024, scheme participants posed as financial-industry professionals in WhatsApp groups, built trust with investors, and then directed them to deposit funds into NanoBit.
Although users' dashboards displayed what appeared to be profitable trades, the SEC alleged the platform never executed any crypto transactions. At least 18 investors lost nearly $1 million in crypto and fiat currency, according to the SEC’s complaint.
Investor funds weren’t used to trade, but rather went to bank accounts in Hong Kong, the SEC said. Participants wired more than $2 million offshore and misappropriated hundreds of thousands of dollars in investors' crypto assets.
NanoBit also falsely claimed an affiliate, NanobitUS Securities, was SEC-registered and tied to reputable financial firms.
The defendants, NanoBit Limited, Radiant Horizons Limited, Sweet Karma Fashion Inc., Zhao Tropical Deli Inc., Jiajie Liu, and Hua Zhao, never appeared in court. The judge found the default willful and no meritorious defense presented.
NanoBit Limited faces the largest share with over $532,000 in disgorgement, nearly $82,000 in prejudgment interest, and a $1.1 million civil penalty. The three other entity defendants each owe $1.1 million in penalties. Liu owes $120,000; Zhao owes $55,000. All must pay within 30 days.
The court permanently barred all six defendants from violating federal anti-fraud provisions and from participating in securities offerings or transactions. Liu and Zhao may still trade in their personal accounts.
The SEC filed the original complaint in September 2024 alongside a parallel action targeting another fake platform, CoinW6, framing both as among its first enforcement actions against relationship-investment scams involving fake crypto platforms. A seventh defendant named in that complaint, Fei Liao, was not included in the default judgment.
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