Group’s Digital Token Fraud Schemes Raised $10 Million, SEC Says

Four men raised more than $10 million from investors through a “two-phased securities fraud” involving digital assets and spent some of the money on mortgage payments and car leases, the SEC alleges in federal court in California.

Steven Chiang set up a purported blockchain-based platform called NASGO in 2017 and, along with Eric Tippetts, sold investors NSG tokens they could use on it, the Securities and Exchange Commission says in the U.S. District Court for the Southern District of California.

Chiang, also known as Cyrus Kong, and Tippetts allegedly told investors they “would receive automatic, consistent payments in NSG tokens ...