Key Takeaways
- • A New York federal judge imposed $5.5 million in disgorgement, prejudgment interest, and civil penalties against NanoBit Limited and five associated defendants on June 16, 2026, in a default judgment after defendants failed to appear in court.
- • The scheme operated as a relationship-investment scam from September 2023 through June 2024, using WhatsApp groups to build trust with victims while operating a fake crypto trading platform that conducted no actual trades.
- • At least 18 investors lost nearly $1 million combined in cryptocurrency and fiat currency, with over $2 million diverted to Hong Kong bank accounts and substantial crypto assets misappropriated from victim accounts.
- • The court permanently barred all six defendants—companies NanoBit Limited, Radiant Horizons Limited, Sweet Karma Fashion Inc., Zhao Tropical Deli Inc., and individuals Jiajie Liu and Hua Zhao—from violating federal anti-fraud laws and participating in securities offerings, though Liu and Zhao retain personal trading privileges.
- • The case demonstrates a sophisticated social engineering methodology: scammers leveraged encrypted messaging platforms, fabricated trading dashboards showing phantom profits, and professional investment language to obscure fraud until victims attempted withdrawals.
Summary
The Eastern District of New York Court has secured a $5.5 million default judgment against a cryptocurrency investment fraud ring that operated through WhatsApp groups and a sham trading platform. The ruling, issued on June 16, 2026, represents a significant enforcement action by the SEC against a relationship-investment scam that targeted retail investors with false promises of cryptocurrency trading returns.
The fraudulent operation, which ran from September 2023 through June 2024, employed a multi-layered deception strategy. Perpetrators established WhatsApp groups where they posed as professional finance advisors, building rapport and trust with potential victims. Once confidence was established, victims were directed to NanoBit Limited's fake crypto trading platform, where they viewed dashboards displaying profitable trades in real-time. However, no actual cryptocurrency trading occurred; the platform was purely a facade designed to create the illusion of legitimate investment activity.
The financial toll on investors was substantial. At least 18 victims lost approximately $1 million collectively through the scheme, with funds transferred in both cryptocurrency and fiat currencies. The defendants diverted more than $2 million to bank accounts in Hong Kong and misappropriated significant crypto holdings from victim accounts. The fraud continued undetected until victims attempted to withdraw funds and discovered the non-existence of their supposed positions.
The court issued a default judgment after the six defendants—NanoBit Limited, Radiant Horizons Limited, Sweet Karma Fashion Inc., Zhao Tropical Deli Inc., and individuals Jiajie Liu and Hua Zhao—failed to appear in proceedings. Beyond the monetary remedies, the court imposed a permanent bar on all six defendants from violating federal anti-fraud statutes and participating in securities offerings or transactions, though Liu and Zhao retained rights to trade personal accounts. This enforcement action underscores the SEC's focus on cryptocurrency fraud facilitated through social engineering on messaging platforms, where scammers exploit encrypted communication channels to establish credibility before executing financial crimes.
The fraudulent operation, which ran from September 2023 through June 2024, employed a multi-layered deception strategy. Perpetrators established WhatsApp groups where they posed as professional finance advisors, building rapport and trust with potential victims. Once confidence was established, victims were directed to NanoBit Limited's fake crypto trading platform, where they viewed dashboards displaying profitable trades in real-time. However, no actual cryptocurrency trading occurred; the platform was purely a facade designed to create the illusion of legitimate investment activity.
The financial toll on investors was substantial. At least 18 victims lost approximately $1 million collectively through the scheme, with funds transferred in both cryptocurrency and fiat currencies. The defendants diverted more than $2 million to bank accounts in Hong Kong and misappropriated significant crypto holdings from victim accounts. The fraud continued undetected until victims attempted to withdraw funds and discovered the non-existence of their supposed positions.
The court issued a default judgment after the six defendants—NanoBit Limited, Radiant Horizons Limited, Sweet Karma Fashion Inc., Zhao Tropical Deli Inc., and individuals Jiajie Liu and Hua Zhao—failed to appear in proceedings. Beyond the monetary remedies, the court imposed a permanent bar on all six defendants from violating federal anti-fraud statutes and participating in securities offerings or transactions, though Liu and Zhao retained rights to trade personal accounts. This enforcement action underscores the SEC's focus on cryptocurrency fraud facilitated through social engineering on messaging platforms, where scammers exploit encrypted communication channels to establish credibility before executing financial crimes.
Go deeper than the headline
Research every firm in this story, track the ones that matter and get the daily briefing — free for 7 days.