The U.S. Securities and Exchange Commission (SEC) on Monday charged three associates of defunct crypto firm Bitcoiin2Gen with defrauding investors of $11.4 million through the 2018 B2G token offering infamously peddled by actor Steven Seagal.

Bitcoiin2Gen and Start Options founder Kristijan Krstic and company promoter John DeMarr allegedly violated federal securities laws during the 2018 raise with DeMarr associate Robin Enos “aiding and abetting,” according to the SEC. DeMarr also faces criminal fraud charges in a parallel suit filed Monday.

The trio allegedly promised to deliver Bitcoiin2Gen’s investors an Ethereum-based token the SEC claims never existed. They allegedly disseminated misleading brochures among 460 investors to whom they’d promised a “mineable” and “tradeable” digital token – B2G – selling the sham for funds they never returned.

Bitcoiin2Gen also banked on the blessing of actor Steven Seagal, whom Krstic and DeMarr (through a pseudonym) trotted out as a “brand ambassador” instead of a promoter earning $120,000 to pump B2G. Seagal, who was not named in the Monday suit, settled related charges last February.

The charges bring the regulator’s initial coin offering crackdown into its second presidential administration. Regulators first began pursuing allegedly fraudulent ICO projects during then-President Trump’s administration, but appear poised to continue that trend under President Biden’s team.

Disclosure
The leader in blockchain news, CoinDesk is a media outlet that strives for the highest journalistic standards and abides by a strict set of editorial policies. CoinDesk is an independent operating subsidiary of Digital Currency Group, which invests in cryptocurrencies and blockchain startups.