The US Securities and Exchange Commission (SEC) has taken legal action against Nathan Fuller, a resident of Cypress, Texas, accusing him of masterminding a significant cryptocurrency fraud that defrauded approximately 150 investors of around $12.3 million. The SEC has filed its complaint on May 28, 2026, in the US District Court for the Southern District of Texas, highlighting a pattern of alleged misrepresentations and fund misuse tied to promises of advanced automated trading.
According to regulators, Fuller promoted investment opportunities in what he described as a sophisticated crypto asset trading venture through his entity, Privvy Investments, LLC, and related names such as Privvy Investments and Gateway Digital Investments.
From late 2022 until around mid-2024, he allegedly solicited funds by touting proprietary artificial intelligence-driven trading bots capable of executing high-frequency arbitrage strategies.
These tools were said to identify and capitalize on minor price discrepancies across digital asset platforms, delivering substantial profits—often pitched as 40% to 50% returns within 30 to 45 days, with some investors hearing claims of over 100% gains in as little as three weeks.
Fuller reportedly assured participants that their capital would benefit from robust protections, including insurance coverage and necessary regulatory licenses.
In reality, authorities claim these elements were largely fictional. The SEC alleges that only a tiny fraction—roughly 3%—of the raised funds went toward actual cryptocurrency trading activities.
Instead, the bulk supported a structure resembling a Ponzi arrangement, where payments to earlier participants came from new inflows rather than genuine profits.
Investigators further contend that Fuller diverted at least $6.2 million for personal benefit, channeling money into luxury purchases like a roughly $1 million home, gambling activities, collectible trading cards, travel expenses, and a Jeep vehicle.
To maintain the illusion and placate concerned investors, he allegedly provided fabricated account statements and even generated misleading communications using tools like ChatGPT.
This case builds on prior proceedings. In a related 2025 bankruptcy matter, Fuller reportedly admitted to operating Privvy as a Ponzi scheme and creating false documentation, leading to the denial of debt discharge for over $12.5 million.
The SEC‘s complaint accuses Fuller of violating key provisions of federal securities laws, including antifraud rules under the Securities Act of 1933 and the Exchange Act of 1934.
The agency is pursuing permanent injunctions, disgorgement of allegedly ill-gotten gains plus interest, and civil monetary penalties.
This enforcement action underscores the regulatory focus on cryptocurrency ventures that leverage hype around emerging technologies like artificial intelligence.
Promoters often exploit investor enthusiasm for automated, high-yield strategies, but authorities warn that such claims require rigorous verification.
As always, investors are now urged to exercise more caution, conduct thorough due diligence, and scrutinize promises of guaranteed returns or proprietary tech in digital asset offerings, as fraud risks remain elevated in this space. The developments serve as a reminder of the challenges in the crypto sector, where seemingly innovative narratives can (at times) mask misconduct.
