In yet another case of defrauding, the US’s Securities and Exchange Commission (SEC) has held the founders of Ormeus Coin accountable. John and JonAtina (Tina) Barksdale – two siblings have been alleged of running a fraud operation that saw $124 million stolen.
As such, the SEC has charged them with fraud – defrauding investors through misleading statements and false claims. The agency highlighted that the two individuals were responsible for offering two unregistered security offerings. It deployed a multi-level marketing scheme that utilized tactics such as misleading roadshows and YouTube videos.
According to SEC’s official statement, the Barksdales offered Ormeus Coin to investors on crypto trading platforms. From June 2017 to April 2018, the Barksdales via a multi-level marketing business offered and sold subscription packages. It included the notorious Ormeus Coin and an investment in a crypto trading program.
The founders falsely claimed that the Ormeus Coin was backed by one of the largest crypto mining operations in the world. They shut down the mining operations in 2019 after generating less than $3 million in total mining revenue. SEC said the defendants falsely stated that Ormeus Coin had a $250 million crypto mining operation and was producing $5.4 million – $8 million per month in mining revenues.
To keep their scam ongoing, Barksdale kept a public website to display a wallet of an unrelated third party, showing assets worth more than $190 million as of November 2021. This was despite the Ormeus wallets worth less than $500,000. It is also alleged that the Barksdales manipulated their native token’s price and misused millions of dollars of investor funds for personal expenses.
The SEC called out the Barksdales for acting as modern-day snake-oil salesmen, using social media, promotional websites, and in-person roadshows to mislead the public and investors.