Regulation
SEC Charges BG Wealth and DSJ Exchange in $130 Million Crypto FraudAdd Securities.io to your preferred sources on GoogleThe Securities and Exchange Commission on Oct. 29, 2026, charged BG Wealth Sharing Ltd and DSJ Exchange Pty Ltd, two foreign-operated, Colorado-incorporated entities, with orchestrating a fraud scheme that used false SEC filings to boost confidence in their investment program and raise more than $130 million from tens of thousands of retail investors, according to an SEC announcement.
The complaint, filed in the U.S. District Court for the Northern District of California, alleges that from at least October 2025 through June 2026 the defendants induced investors in more than 40 U.S. states and multiple U.S. territories to participate in a supposed “wealth-sharing program” that promised extraordinary, risk-free returns from so-called SI-generated “signals” for crypto asset trading. The defendants solicited and accepted investments from at least 45 residents of that district, according to the complaint.
According to the complaint, BG Wealth held itself out as the world’s largest hedge fund and an SEC-licensed investment adviser, promised returns of at least 60% per month, told investors they could double their principal in 40 days, and assured them their investments carried zero risk. It attributed the purported results to proprietary trading signals with 99.6% accuracy developed by its founder, “Professor” Stephen Beard, and claimed to hold £30 million in initial capital to cover all investment losses. Beard, who is not charged, is identified as BG Wealth’s purported founder and chief executive officer, a person of unknown age and residency who communicated with investors through live video appearances and BonChat, an encrypted messaging platform based in Hong Kong. On information and belief, the complaint states, Beard is an assumed identity.
BG Wealth is a Colorado corporation formed in April 2025 whose purported principal place of business was a virtual mailbox, and DSJ Exchange is a Colorado corporation formed in June 2025 whose purported principal place of business was a temporary office-rental space, the complaint states. Neither entity was ever registered with the SEC, and the complaint alleges on information and belief that the scheme was operated by individuals located abroad.
Fabricated Credentials and False Filings
BG Wealth filed a Form ADV with the SEC on Aug. 16, 2025, claiming to be an exempt reporting adviser, and DSJ Exchange filed a Form D on July 11, 2025, announcing a purported $100 million exempt offering of pooled investment fund interests under Rule 506(c) of Regulation D and claiming revenue of over $100 million, according to the complaint. The defendants then allegedly directed investors to those publicly viewable filings on the SEC’s Investment Adviser Public Disclosure website and EDGAR system as supposed proof of registration, and displayed purported SEC registration certificates bearing the agency’s seal on BG Wealth’s website and in Beard’s weekly video appearances. The certificates incorporated the Central Registration Depository number from the Form ADV and the Central Index Key number from the Form D, linking them to the real filings. The complaint states that the SEC does not issue registration certificates and granted no license or approval to either defendant.
The filings themselves contained false information, the complaint alleges. BG Wealth’s Form ADV represented that an independent accounting firm named Indicator Global audited its private funds, but Indicator Global does not appear in any public registry of federal or state accounting firms and instead appears to have filed its own Form ADV as an exempt reporting adviser. The Form ADV listed a PostNet virtual mailbox as BG Wealth’s principal office and a U.S. telephone number that was disconnected, and mail sent to the addresses in the filing was returned as undeliverable. The complaint also alleges BG Wealth failed to produce books and records requested by SEC staff to substantiate its disclosures. The notary whose stamp appears on DSJ Exchange’s Form ID, the application for EDGAR access codes, did not notarize it, and the company’s listed addresses, phone numbers, and email addresses were false, with mailed SEC subpoenas returned or unanswered.
According to the complaint, BG Wealth directed investors to open accounts on DSJ Exchange’s online platform or mobile app and deposit crypto assets, including USDC, USDT, and Ethereum. Beard distributed alphanumeric trading signals twice daily through BonChat, and investors copied each signal into a designated tab in their accounts and selected confirm; the platform then displayed a supposed transaction and profit. The trades, profits, and balances were fabricated, the complaint alleges, with displayed account balances generally doubling after approximately 40 days. BG Wealth had claimed that DSJ Exchange automatically traded only 1% of the capital in each investor’s account, purportedly pooled with other investors’ funds, and that BG Wealth took 40% of any profit on every trade executed.
The complaint describes a multi-level marketing structure in which investors who recruited at least five others could progress through as many as 12 promoter levels and qualify for monthly bonuses, rewards, commissions, and transaction volume dividends. One promoter with a brick-and-mortar office in Concord, California, rose to Level 7 with approximately 5,000 downstream investors. Promotion ran through YouTube, TikTok, Facebook, Instagram, and Telegram; weekly live videoconferences on Zoom held from as early as December 2025 through June 2026; and roadshows in Las Vegas on Nov. 30, 2025, Lā’ie, Hawaii, on Dec. 15, 2025, and Salt Lake City on April 15, 2026.
From March through early June 2026 alone, the defendants received over $130 million from more than 223,000 blockchain addresses, the complaint alleges. Rather than trading investor assets as represented, the defendants misappropriated the vast majority and returned no more than $25 million to wallet addresses likely associated with investors in Ponzi-like payments, while discouraging withdrawals with fees as high as 20% and multi-day delays. Investors suffered losses exceeding $100 million, according to the complaint.
Regulatory Warnings and Collapse
Beginning in May 2025, at least seven foreign securities regulators issued public warnings that BG Wealth and DSJ Exchange were fraudulent or operating without required licenses, and beginning in March 2026 state authorities in Alaska, Hawaii, Oklahoma, Texas, Utah, Washington, and Wisconsin issued warnings and cease-and-desist orders against the defendants and certain senior promoters, the complaint states. The defendants nevertheless operated into June 2026, repeatedly changing website domains after authorities identified their sites.
On April 23, 2026, the FBI seized BG Wealth’s original website domain as part of a joint law enforcement operation. According to the complaint, Beard told investors a Chinese hacker was responsible, DSJ Exchange eventually blocked withdrawals entirely, and the defendants demanded additional “tax” payments to unlock accounts and directed investors to deposit still more assets to migrate to a new platform called HQI Exchange, or HQIEX. Investors who paid remained unable to withdraw their funds. On Sept. 29, 2026, DSJ Exchange changed its name on EDGAR to Horizon Crest Capital Inc., purportedly a New York corporation, and filed a Form D for a purported Horizon Crest offering.
The complaint charges both defendants with violating Section 17(a) of the Securities Act of 1933 and Section 10(b) of the Securities Exchange Act of 1934 and Rule 10b-5 thereunder, and charges BG Wealth with violating Sections 204(a) and 207 of the Investment Advisers Act of 1940. The SEC seeks permanent injunctions, disgorgement of ill-gotten gains with prejudgment interest on a joint and several basis, civil monetary penalties, and an order barring BG Wealth and those acting with it from filing Forms ADV as an exempt reporting adviser. The SEC has demanded a jury trial.
“This alleged scheme was well-planned, as evidenced by how many different communications channels the defendants chose to broadcast to their target audiences,” said Laura D’Allaird, Chief of the SEC Enforcement Division’s Cyber and Emerging Technologies Unit. “They further sustained the ruse by displaying fake certificates with the SEC’s seal and making periodic payments to certain investors – a Ponzi-like tactic – while misappropriating the remaining funds.”
The SEC said the Form ADV filed by BG Wealth and the Form D filed by DSJ Exchange have been removed from the Commission’s website. Its Office of Investor Education and Assistance has issued investor alerts warning that scammers are using SEC exempt reporting adviser filings to create a false impression of legitimacy, and the agency encourages investors to use Investor.gov to check the background of anyone offering or selling them an investment. The SEC acknowledged assistance from the Alberta Securities Commission, the Hawaii Department of Commerce and Consumer Affairs’ Securities Enforcement Branch, the Texas State Securities Board, the Utah Department of Commerce’s Division of Securities, the Washington State Department of Financial Institutions, and the Wisconsin Department of Financial Institutions.