HomeNewsAustralian Craig Sproule Being Charged with The SEC for Defrauding Crypto Investors

Australian Craig Sproule Being Charged with The SEC for Defrauding Crypto Investors

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We are barely into the new year and the crypto sphere already has a lot going on. Starting with the Fed announcement that saw Bitcoin’s price plummeting and of course, the SEC charges that have everyone talking. 

On Thursday the 6th of January 2022, the SEC announced charges against Craig Sproule. Craig is an Australian citizen and entrepreneur who refers to himself as “Man behind the machine” on social media. 

He was charged alongside two companies that he has founded namely Metavine Inc. and Crowd Machine Inc. Craig and his companies were accused of releasing false and misleading statements related to an unregistered offer and sale of digital asset securities. 

According to the charges, Sproule claimed to have raised $40.7 million through his companies collectively in an ICO of Crowd Machine Compute Tokens (CMTCs); this was back in January of 2018. 

Instead of using the ICO proceeds to develop a new technology to improve Metavine, he diverted the money to gold mining entities in South Africa; unknown to the investors. According to SEC, Crowd Machine and its owner sold CMTCs without registering their offers and sales. They also failed to determine whether the underlying investors were accredited or not. 

In the same light, Kristina Littman, Chief of the SEC Enforcement Division’s Cyber Unit promised that they would continue to hold accountable issuers of digital asset securities who fail to provide fulsome and truthful disclosure to the public. 

Who is Craig Sproule?

Figure: Craig Sproule “Man behind the machine” (Source the Australian)

As already mentioned, Craig is an Australian crypto investor and entrepreneur. He currently lives in California but was born in Lismore NSW. His company, Crowd Machine was aimed at creating a Blockchain replacement for Amazon Web Services, with a distributed system. Over the years, it has seemed as if Craig has been doing well financially claiming to have raised $40.7 million through an ICO of CMCT in 2018. On social media, people know him as “Man behind the Machine”. 

The Final Verdict 

The complaint was filed in the United States District Court for the Northern District of California. Sproule and Crowd Machine were charged with violating the antifraud and registration provisions of the federal securities laws. 

  • While Sproule and Crowd Machine have neither admitted nor denied the allegations, they have consented to judgments enjoining them for breaking these laws 
  • The court ordered the immediate and permanent disabling of CMCT tokens as well as their removal from digital asset trading platforms 
  • Sproule was prohibited from serving as an officer or director of a public company 
  • Sproule was ordered to pay a $195,047 
  • Disgorgement, prejudgment interest, and civil penalties as to Crowd Machine will be determined by the court at a later date.
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Gabriel Santos
Gabriel Santoshttps://gabrielsantos.eth
Gabriel has over 15 years of experience trading various asset classes as a full-time technical analysis trader. He was first introduced to cryptocurrency in 2017 and was immediately hooked. Aside from analyzing charts, Gabriel enjoys going to the gym and lifting weights.
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