in Trading

CFO Embezzles $5M for Crypto and Meme Stock Investments

• The U.S. Securities and Exchange Commission has charged Cooper J. Morgenthau, the CFO of African Gold Acquisition Corp., with fraud after he embezzled more than $5 million to invest in crypto and “meme stocks.”
• Morgenthau initially embezzled $1.2 million from African Gold and used it to purchase crypto assets and securities. He then attempted to cover his losses by raising $4.7 million through two SPAC series, but invested the money raised in cryptocurrency again.
• Morgenthau lied to auditors and accountants, falsified records at African Gold, and filed false certifications with the SEC. He faces financial penalties and will be barred from serving in certain executive positions.

The U.S. Securities and Exchange Commission has recently filed charges against Cooper J. Morgenthau, the chief financial officer (CFO) of African Gold Acquisition Corp., for fraud. According to the SEC’s press release, Morgenthau embezzled more than $5 million with the intention of investing it in cryptocurrency and “meme stocks.”

Morgenthau began his scheme in June 2021, when he embezzled $1.2 million directly from African Gold. He then used the stolen funds to purchase cryptocurrency assets and securities, as well as to pay for personal expenses. After losing a significant amount of the funds, Morgenthau attempted to cover his losses by raising $4.7 million through two special purpose acquisition (SPAC) series called Strategic Metals Acquisition Corp. I and II. Incredibly, he then proceeded to invest the money raised in cryptocurrency once again, and by August 2022, he had completely depleted the funds.

The SEC alleges that Morgenthau violated antifraud provisions of federal securities laws, as he lied to auditors and accountants, falsified records at African Gold, and filed false certifications with the SEC. As a result, he now faces financial penalties and will be barred from serving in certain executive positions.

This case serves as a reminder of the dangers of investing in cryptocurrency and other high-risk investments. While these investments can offer significant potential rewards, they can also carry significant risks and losses. As such, it is important to be aware of the potential risks and to do your research before investing in any asset.