The U.S. Trustee Program (USTP) has secured a judgment denying chapter safety to a Texas man who tried to evade greater than $12.5 million in money owed linked to a cryptocurrency Ponzi scheme.
On August 1, the Chapter Court docket for the Southern District of Texas entered a default judgment in opposition to Nathan Fuller, proprietor of Privvy Investments LLC. Fuller had filed for Chapter 7 chapter in October 2024, shortly after a state court docket appointed a receiver to grab his belongings following investor lawsuits.
However federal investigators discovered that Fuller hid belongings, falsified paperwork, and lied underneath oath in an effort to keep away from repaying collectors.
Chapter Court docket Bars Crypto Scheme Operator From Discharging $12.5M
In line with the USTP, Fuller used Privvy Investments to solicit funds underneath the guise of crypto investments, solely to divert investor cash for private use.
Information present that he spent closely on luxurious gadgets and playing journeys and bought an almost $1 million dwelling for his ex-wife, who was additionally concerned within the enterprise. Regardless of the separation, Fuller continued to reside on the property.
U.S. Trustee Kevin Epstein, who oversees Area 7 overlaying the Southern District of Texas, stated the ruling underscores this system’s stance in opposition to fraud. “Fraudsters searching for to whitewash their schemes won’t discover sanctuary in chapter,” Epstein stated in an announcement.
“The USTP stays vigilant for instances filed by dishonest debtors, who threaten the integrity of the chapter system.”
Investigators alleged that Fuller not solely hid in depth belongings but additionally failed to take care of information and submitted false testimony in each his private chapter submitting and the one filed on behalf of Privvy.
At one level, Fuller was held in civil contempt for failing to adjust to court docket orders. Throughout proceedings, he admitted to working Privvy as a Ponzi scheme, fabricating documentation, and offering false statements designed to hinder the work of the court-appointed Chapter 7 trustee.
After failing to reply to the USTP’s criticism, the court docket entered a default judgment in favor of the company. Consequently, Fuller stays personally responsible for his money owed, together with greater than $12.5 million in unsecured obligations listed in his filings. Collectors are actually free to proceed assortment efforts in opposition to him.
The USTP stated its mission is to guard the integrity of the chapter system for debtors, collectors, and the general public. The company emphasised that the result in Fuller’s case demonstrates its dedication to holding dishonest actors accountable.
The judgment provides one other chapter to the mounting scrutiny round crypto-linked funding schemes. Whereas reliable blockchain companies proceed to lift capital and construct infrastructure, fraudulent ventures akin to Fuller’s spotlight the dangers going through traders.
Earlier this 12 months, web3 pockets infrastructure agency Privy, a separate firm unrelated to Fuller’s operation, closed a $15 million funding spherical led by Ribbit Capital, bringing its whole raised to greater than $40 million.
The corporate’s wallet-enabled stack powers tasks like Hyperliquid, Farcaster, OpenSea, and Blackbird, serving over 50 million accounts throughout funds, DeFi, and gaming.
The juxtaposition of those developments displays a maturing crypto sector nonetheless grappling with belief points stemming from fraud.
Fraud Shadows Over Crypto Sector as Comparable Instances Spotlight Investor Dangers
In the same case, on July 8, San Jose-based fintech agency Linqto filed for Chapter 11 chapter within the Southern District of Texas, exposing deep cracks in its enterprise mannequin.
Linqto’s Chapter 11 submitting uncovers the pre-IPO phantasm, as traders could not have owned shares as believed.#Linqto #Bankruptcyhttps://t.co/1VVgzRgi5s
— Cryptonews.com (@cryptonews) July 8, 2025
As soon as marketed as a gateway for on a regular basis traders to purchase pre-IPO shares in tech giants like Ripple and CoreWeave, the platform now faces allegations that prospects could by no means have really owned the shares they believed they bought.
The corporate listed belongings and liabilities between $500 million and $1 billion, with greater than 10,000 collectors probably affected.
Chief Restructuring Officer Jeffrey Stein stated “years of mismanagement” and securities legislation violations relationship again to 2020 left Linqto probably bancrupt, additional shaking confidence in retail entry to non-public markets.
@TheJusticeDept has filed a civil forfeiture criticism to get well $5M in stolen bitcoin traced to SIM swap assaults.
#Bitcoin #Cybercrime #Simswaphttps://t.co/tlTqzTUKDr— Cryptonews.com (@cryptonews) September 9, 2025
Individually, the U.S. Division of Justice introduced yesterday a civil forfeiture motion to grab over $5 million in Bitcoin stolen by SIM swap assaults.
Prosecutors stated attackers hijacked victims’ cellphone numbers between October 2022 and March 2023, intercepting authentication codes to empty crypto wallets.
The stolen funds have been allegedly funneled by a number of wallets and finally into an account at Stake.com, a web-based on line casino.
Investigators accuse the perpetrators of utilizing round transactions to disguise the supply of the Bitcoin earlier than consolidation.
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