SEC Wins NanoBit Fraud Case, Court Orders $5.5 Million Payment

Highlights:

• The court brought the NanoBit fraud case to a close by ordering the defendants to pay about $5.52 million.
• The SEC alleged that scammers used Instagram and WhatsApp groups to build trust before directing victims to a fake crypto platform.
• The final judgment permanently bars the defendants from taking part in future securities offerings and investment activities.

The U.S. Securities and Exchange Commission announced on Monday that it secured a final judgment against NanoBit Limited and five related defendants over an alleged crypto investment fraud scheme. The U.S. District Court for the Eastern District of New York entered the final judgment on June 16.

JUST IN: SEC wins a $5.4M judgment in the NanoBit crypto fraud case, alleging a fake trading platform and misappropriation of investor funds. Regulatory action like this underscores ongoing enforcement risk for crypto platforms. $BTC $ETH pic.twitter.com/NpTFRqXxe5

— Bpay News (@bpaynews) June 30, 2026

The SEC announced the outcome nearly two weeks later after the court completed the case. The agency launched the lawsuit after claiming that the NanoBit operators defrauded at least 18 investors of hundreds of thousands of dollars.

The SEC said the lawsuit marked its first enforcement action involving a crypto relationship investment scam. According to the complaint, the defendants contacted investors through social media, built personal relationships, and later invited them into private WhatsApp groups.

The regulator alleged that the defendants gained investors’ confidence before directing them to NanoBit. The SEC said the defendants convinced victims to deposit money by promoting false investment opportunities and misleading claims.

The court entered judgment against NanoBit Limited, Radiant Horizons Limited, Sweet Karma Fashion Inc., Zhao Tropical Deli Inc., Jiajie Liu, and Hua Zhao after finding securities law violations. The court permanently barred every defendant from participating in future securities offerings. The district court also ordered the defendants to pay civil penalties, disgorgement, and prejudgment interest.

NanoBit Fraud Case Exposes WhatsApp Investment Trap

The SEC claimed that the defendants initially reached out to prospective investors via Instagram and other social media channels. They later moved those conversations into private WhatsApp groups. The SEC said that the defendants used to pretend they were financial advisors and took time to establish a rapport with investors before informing them about investments. Afterward, they introduced NanoBit as a genuine crypto trading platform capable of delivering significant profits.

The SEC said the defendants falsely represented that an affiliate, called NanobitUS Securities, was registered with the SEC. They also pitched false initial coin offerings and guaranteed big returns to investors. The SEC alleges that the defendants embezzled investor funds rather than investing them in cryptocurrency markets. The agency claimed that the participants of the scheme directed over $2 million from investor funds to bank accounts in Hong Kong.

The SEC claimed that the defendants rejected requests for legitimate withdrawals from investors seeking their funds back. The agency said the defendants gave repeated excuses instead of returning investor funds. The SEC also alleged that the defendants demanded additional fees before processing withdrawals that never happened.

Defendants Face Millions in Penalties After Final Judgment

The court ordered the defendants to pay about $5.52 million in combined civil penalties, disgorgement, and prejudgment interest in the NanoBit fraud case. NanoBit must pay a $1.18 million civil penalty under the final judgment.

The company must also return more than $532,000 in alleged unlawful gains and pay nearly $81,200 in prejudgment interest. Radiant Horizons Limited, Sweet Karma Fashion Inc., and Zhao Tropical Deli Inc. must each pay separate civil penalties of $1.18 million. Jiajie Liu must also pay about $120,000 in civil penalties, disgorgement, and prejudgment interest.

The NanoBit judgment follows several recent SEC enforcement actions targeting alleged cryptocurrency investment fraud. The agency charged Texas resident Nathan Fuller in May over an alleged $12.3 million AI-powered crypto trading scheme. The SEC also charged crypto executive Donald Basile and two companies after alleging they raised about $16 million through false Bitcoin Latinum claims.