The Securities and Exchange Commission charged Nathan Fuller with a $12.3 million crypto asset fraud scheme on May 28, 2026. The complaint, filed in the Southern District of Texas, alleges Fuller raised approximately $12.3 million from roughly 150 investors by promising outsized returns from so-called AI-powered crypto trading bots. Only about three percent of investor funds were ever used for actual trading.
Fuller, a resident of Cypress, Texas, allegedly marketed the scheme through Privvy Investments and related entities. He promised returns as high as 100 percent, with some investors told they could earn 40 to 50 percent in just 30 to 45 days. The SEC alleged these claims were entirely fabricated. Fuller reportedly used ChatGPT to generate fake responses when investors asked about their accounts.
According to the SEC’s litigation release LR-26558, roughly $6.2 million was diverted for Fuller’s personal use. Another $5.5 million went toward Ponzi-style payments to earlier investors to create the illusion of profits. The actual crypto trading activity amounted to less than $370,000 of the total funds raised. The remainder evaporated through misappropriation and operating expenses.
How the fake AI bot scheme operated
Fuller allegedly told investors his proprietary software used artificial intelligence to execute high-frequency crypto arbitrage trades. He claimed the bots analyzed market data in real time and never lost money. The SEC alleged no such technology existed at the scale described, and the performance statements provided to investors were fabricated.
The complaint states Fuller showed investors fabricated account dashboards and balances. When withdrawal requests arrived, he allegedly stalled, invented technical excuses, or issued partial payments from new investor capital. This structure is textbook Ponzi mechanics, where earlier participants are paid with funds from later recruits rather than actual trading profits.
Red flags investors can watch for
Several warning signs appear repeatedly in crypto and AI investment schemes. Guaranteed returns with no risk are mathematically impossible over time. Any claim of double-digit monthly returns should trigger immediate skepticism. Legitimate trading strategies carry risk and disclose that risk clearly.
Pressure to invest quickly is another common fraud tactic. Fraudsters often create artificial scarcity, telling victims spots in the program are limited. Refusal to provide audited financial statements or verifiable performance history should end the conversation immediately. Registered investment advisers must file Form ADV and make their records public.
What investors can do if affected
If you invested with Nathan Fuller or Privvy Investments, or any unregistered promoter promising guaranteed crypto returns, contact the SEC Office of the Whistleblower. You can also file a complaint through the SEC’s online tip portal. Victims may be eligible for a Fair Fund distribution if the SEC recovers assets.
Document every communication, wire transfer, and statement you received. Gather screenshots of marketing materials, account dashboards, and text message threads. This evidence strengthens both regulatory proceedings and any private civil action you pursue. Preserve everything before platforms are taken offline or accounts deleted.
Broader SEC enforcement context
The Fuller complaint is part of a broader SEC crackdown on crypto and AI-themed investment fraud. Regulators have warned that combining buzzwords like artificial intelligence and blockchain does not exempt a scheme from registration requirements. Operating as an unregistered investment adviser is itself a violation, separate from any fraud allegations.
The SEC’s Division of Enforcement continues to prioritize retail investor protection. Chairman Paul Atkins has emphasized returning to materiality-focused regulation while maintaining aggressive enforcement against outright fraud. The Fuller case will likely proceed toward trial unless Fuller agrees to a settlement including disgorgement and a permanent bar from the securities industry.
