SEC Settles Fraud Charges Filed Against Crypto Exchange Bitqyck and its Founders, Claims $13 Million in Unregistered Securities Offering

The Securities and Exchange Commission (SEC) has settled charges with Bitqyck Inc. and its founders, Bruce Bise and Sam Mendez. The SEC alleges that Biqyck and its founders defrauded investors and operated an unregistered exchange. Bitqyck also created and maintained its own online trading platform called

According to the SEC’s complaint, Biquyck­ created and sold Bitqy and BitqyM in unregistered securities offerings to more than 13,000 investors, raising more than $13 million.

The SEC claims that between December 2016 and February 2019, Bitqyck promoted two digital tokens,  Bitqy and BitqyM, to prospective investors in 45 U.S. states, two U.S. territories, and 20 countries through “multiple, fraudulent unregistered digital asset securities offerings.”

The defendants allegedly told investors every investor who purchased a Bitqy token would “automatically receive one-tenth of one share of Bitqyck common stock through the operation of a “smart contract” associated with the token.”

The SEC states that no smart contract associated with the token included equity and no ownership was ever transferred.

The SEC complaint states:

“Bise and Mendez controlled Bitqyck’s bank accounts and funds, paid themselves distributions from the Bitqyck bank accounts funded exclusively with investor funds, and used those accounts to pay for their own personal expenses. Between personal distributions and payments for personal expenses, Bise received at least approximately $684,092 and Mendez received approximately $644,821 in ill-gotten gains. Defendants paid $4.5 million as sales commissions to investors who referred new investors to Bitqyck. Collectively, investors lost more than two-thirds of their investments.”

David Peavler, Director of the SEC’s Fort Worth Regional Office, commented on the SEC action:

“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 complaint, filed in U.S. District Court for the Northern District of Texas, seeks permanent injunctions, return of allegedly ill-gotten gains with interest, and civil money penalties.

Without admitting or denying the allegations, Bitqyck, Bise, and Mendez consented to final judgments agreeing to all the injunctive relief.

Bitqyck also consented to an order requiring that it pay disgorgement, prejudgment interest and a civil penalty of $8,375,617.  Bise and Mendez consented to the entry of an order that they each pay disgorgement, prejudgment interest and a civil penalty of $890,254 and $850,022, respectively.


SEC v Bitqyck 8.29.19comp-pr2019-164

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