Bitqyck Inc Charged for $13 Million ICO Fraud by SEC

Bruce Bise and Sam Mendez, the founders of Bitqyck Inc have been changed for selling unregistered securities to the investors.
1 / 5 ( 2 votes )

Bitqyck Inc. with its founders have been charged for operating ICO scam for selling unregistered securities to its investors. According to the report, the company defrauded investors a total of $13M through this ICO fraud. The company sold victims the unregistered ICO Bitqy and BitqyM. These were operated under an unregistered exchange.

The SEC’s claimed that Bitqyck and its founders Bruce Bise and Sam Mendez has by now sold to more than 13,000 investors. This has helped then in raising more than $13 million.

The Investors involved in the scheme received received $4.5 million for referring new investors. However, they lost more than two-thirds of the total investment to the Dallas-based company.

The further investigation revealed that Bise and Mendez had misrepresented QyckDealsas a global online marketplace. QyckDealsas is a daily deals platform that uses Bitqy. The founders made false claim about Bitqy that each token was worth around fractional shares of Bitqyck stock. This was done through a “smart contract.”

The complaint reported that the defendants made investors believe that BitqyM tokens provided an interest in a Bitqyck cryptocurrency mining facility and this facility was was powered by electricity with much cheaper rate than what was available in the market.

However, the fact was that these claims were nothing but mere lies. There was neither cheaper electricity nor any mining facility.  Bitqyck has been blamed for illegally operating TradeBQ which is an unregistered national security exchange. This was brought to picture for offering trading in a single security that is Bitqy.

David Peavler who is the director of the SEC’s Fort Worth Regional Office said, “Because digital investment assets represent a new and exciting technology, they can be very alluring, especially if investors believe they are getting in on the ground floor and will own part of the operations. We allege that the defendants took advantage of investors’ appetite for these investments and fraudulently raised millions of dollars by lying about their business.”

The SEC’s has filed a complaint with the U.S. District Court for the Northern District of Texas. SEC is seeking permanent injunctions, returning money gained through scam with interest as well as civil money penalties. According to the current reports, Bitqyck, Bise and Mendez have consented to final judgments and have agreed to all the injunctive relief.

Bitqyck has been asked to pay disgorgement, prejudgment interest and a civil penalty of $8,375,617.

David Hirsch, Melvin Warren, and Carol Hahn were the SEC officials who investigated the entire case. They received litigation support from Keefe Bernstein. The case was supervised by Scott F. Mascianica and Eric R. Werner.