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The SEC has won a default judgment against NanoBit Limited and five related defendants over a fake crypto trading platform that the agency said was used to steal investor funds.
The U.S. District Court for the Eastern District of New York entered the judgment on June 16, resolving the SEC’s case against the defaulting defendants after the agency filed the action in September 2024.
Six Defendants Owe $5.52M
The judgment orders NanoBit to pay $1.8 million in disgorgement, interest and penalties. Radiant Horizons Limited, Zhao Tropical Deli Inc. and Sweet Karma Fashion Inc. were each ordered to pay $1.18 million in civil penalties.
Jiajie Liu must pay $120,088, while Hua Zhao must pay $55,204. The total amount owed is about $5.52 million. The court also permanently barred the defendants from violating federal antifraud provisions tied to securities offers and sales.
WhatsApp Groups Pushed Fake NanoBit ICOs
The SEC said the scheme ran from at least September 2023 to June 2024 and used social media apps to reach investors. The complaint said people involved in the scheme posed as financial industry professionals in WhatsApp groups, built trust with investors and then directed them to the supposed NanoBit crypto asset trading platform.
NanoBit also allegedly claimed that an affiliate, NanobitUS Securities, was registered with the SEC as a broker. The agency said that claim was false. The supposed advisers then promoted fake initial coin offerings as a way for investors to earn returns through the platform.
SEC Says No Real Trading Occurred
The SEC said no real transactions took place on the NanoBit platform. Instead, investor money allegedly went to people tied to the scheme.
The agency said more than $2 million was wired to bank accounts in Hong Kong, while hundreds of thousands of dollars in crypto assets were also misappropriated.
The court granted the SEC’s motion for default judgment after the defendants did not appear and no opposition was filed.
Relationship Scams Remain SEC Focus
The case was one of the SEC’s first enforcement actions tied to relationship investment scams, where scammers use messaging apps and personal trust-building before pushing victims into fake investments.
The judgment gives the SEC a fraud win while reinforcing its warning about investment pitches made through social media and messaging apps. The agency told investors not to rely only on group chats when making investment decisions and to check the background of anyone offering or selling an investment.
The case underscores the SEC’s warning that trading screens, group chats and claimed registrations can be used to make fake platforms appear legitimate.
