Hassan Maishera
TL;DR
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The SEC charged Nathan Fuller with raising about $12.3 million from roughly 150 investors.
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Fuller lured the investors by falsely claiming proprietary AI bots ran high-frequency crypto arbitrage.
Regulator Alleges Investors Were Lured With Promises of Guaranteed Crypto Profits
The U.S. Securities and Exchange Commission (SEC) has charged a Texas resident with orchestrating a $12.3 million cryptocurrency fraud scheme that allegedly relied on fictitious AI-powered trading bots and misleading investment promises.
According to a complaint filed Thursday in federal court in Houston, Nathan Fuller of Cypress, Texas, raised funds from approximately 150 investors across nine U.S. states and two foreign countries through his company, Privvy Investments LLC. Fuller also operated under the business name Gateway Digital Investments.
The SEC alleges that Fuller marketed proprietary AI-driven trading bots that could automatically scan cryptocurrency exchanges and exploit small price discrepancies through high-frequency arbitrage trading.
Investors were told they could earn returns of 40% to 50% within 30 to 45 days, while some were reportedly promised guaranteed profits exceeding 100% in as little as 21 days.
However, regulators claim the technology did not perform as advertised. The complaint states that even when the software was operational, it lacked both artificial intelligence capabilities and basic risk-management features such as stop-loss protections.
According to the SEC, Fuller invested just $380,000—roughly 3% of the $12.3 million raised—into cryptocurrency purchases. Those trades reportedly generated no profits.
Instead, investigators allege that Fuller diverted investor money for personal expenses and to sustain the scheme.
The SEC claims he misappropriated at least $6.2 million to fund a lavish lifestyle that included the purchase of a nearly $1 million home, gambling activities, travel expenses, sports trading cards, and a Jeep. Another $5.5 million was allegedly used to make payments to earlier investors in a manner consistent with a Ponzi scheme.
False Claims Used to Reassure Investors
To maintain investor confidence, Fuller allegedly made a series of false representations about the legitimacy and security of the operation.
The SEC says he claimed to possess a Texas money-transmitter license, maintain a surety bond, and offer FDIC-insured investment protection. Investors were also told that the company carried professional liability insurance coverage.
Regulators allege none of these claims were true.
The complaint further states that Fuller created a fictitious insurance company called Texas Guarantors & Securities and altered a legitimate insurance certificate from biBERK to falsely indicate $5 million in professional liability coverage—coverage that the actual policy did not provide.
As investors began requesting withdrawals in mid-2024, Fuller allegedly launched another deceptive effort to delay concerns.
According to the SEC, he created a fictitious company named Blockchain Audit Solutions and used ChatGPT to generate a fraudulent letter sent to investors. The document claimed that investor accounts had been transferred and required additional Know Your Customer (KYC) verification before withdrawals could be processed.
The regulator alleges the communication was designed to stall withdrawal requests and conceal the scheme's financial problems.
The SEC action follows earlier legal troubles involving Privvy Investments. In September 2025, a Texas bankruptcy court denied Fuller a discharge of more than $12.5 million in debt after he reportedly admitted to operating Privvy as a Ponzi scheme and fabricating documents to support the business, according to the U.S. Department of Justice.
Fuller filed for Chapter 7 bankruptcy in October 2024 after investors pursued legal action in Texas state court, and a court-appointed receiver took control of his assets.
While the SEC's latest complaint does not reference the bankruptcy ruling or Fuller's prior admissions, those proceedings add further scrutiny to the allegations.
The investigation was supported by the SEC's Cyber and Emerging Technologies Unit, a specialized enforcement division established in early 2025 to address fraud involving emerging technologies.
The unit has pursued several high-profile cases involving fraudulent AI investment schemes, including its action against PGI Global founder Ramil Palafox, who was accused of operating a $198 million scheme built around a purported AI-powered trading platform.
The case also follows the SEC's December enforcement action against a network of fake crypto exchanges and so-called AI investment clubs allegedly linked to a separate $14 million fraud operation.
SEC Seeks Penalties and Permanent Ban
The SEC has charged Fuller with violating securities registration and antifraud provisions under both the Securities Act and the Securities Exchange Act.
The regulator is seeking permanent injunctions, disgorgement of allegedly ill-gotten gains with prejudgment interest, civil monetary penalties, and an order barring Fuller from participating in future securities offerings.
