SEC v. Xue Samuel Lee; a/k/a "Sam" Lee; Brenda Indah Chunga; and a/k/a "Bitcoin Beautee", No. LR-25933, District of Maryland (Jan. 30, 2024) — Press Release
raw: Xue Samuel Lee, a/k/a “Sam” Lee and Brenda Indah Chunga, a/k/a “Bitcoin Beautee”
Xue Samuel Lee, a/k/a “Sam” Lee and Brenda Indah Chunga, a/k/a “Bitcoin Beautee”, No. 1:24-cv-00296-RDB (Jan. 30, 2024)
summary
Xue 'Sam' Lee and Brenda Chunga were charged by the SEC for orchestrating the $1.7 billion HyperFund crypto pyramid scheme, resulting in a settlement for Chunga and litigation for Lee.
paragraph
The SEC charged Xue Lee and Brenda Chunga for operating HyperFund, a crypto pyramid scheme that raised over $1.7 billion from global investors. The defendants allegedly violated federal anti-fraud and registration provisions by promoting membership packages that promised high returns from non-existent mining operations. Chunga has agreed to settle civil charges and pleaded guilty to criminal conspiracy, while Lee faces ongoing litigation.
narrative
The SEC charged Xue 'Sam' Lee and Brenda 'Bitcoin Beautee' Chunga for their roles in the HyperFund crypto asset pyramid scheme, which raised more than $1.7 billion from global investors. Between 2020 and 2022, the defendants promoted membership packages claiming high returns from crypto mining and Fortune 500 associations, despite having no real revenue source other than new investor funds. The scheme collapsed in 2022, leaving investors unable to withdraw their capital. Chunga has agreed to settle civil charges and pleaded guilty to criminal conspiracy to commit securities and wire fraud. The SEC is seeking permanent injunctions, disgorgement, and civil penalties from both parties. While Chunga's civil matter is settling, Lee's charges will proceed to litigation in federal court.
Classified ponzi(confidence 97%). EDGAR detection: forms Form D· recall 35% / precision 15%. detection rule →
Statutes
15 U.S.C. § 77q(a)15 U.S.C. § 78j(b)
Parties
Securities and Exchange CommissionXue Samuel LeeBrenda Indah Chunga
Keywords
leechungabitcoin beauteesechyperfundbrenda indahindah chungachunga bitcoinsecurities exchangeexchange commissionpyramid schemecrypto assetsecuritiescryptoxue
Exhibits & Attached Documents (1)
Extracted insights
Dollar amounts 2
- $1.70B $1.7 Billion ≥$1B
- $1.70B $1.7 billion ≥$1B
Entities 8
- person BRENDA INDAH CHUNGA
- court complaint in federal district court
- organization HyperFund
- person permanent injunctive relief
- agency Securities and Exchange Commission
- organization Securities and Exchange Commission
- person settle charges
- person XUE SAMUEL LEE
Triples 10
- Securities And Exchange Commission charged Xue Samuel Lee And Brenda Indah Chunga
- Xue Samuel Lee founded Hyperfund Crypto Pyramid Scheme
- Xue Samuel Lee And Brenda Indah Chunga promoted Hyperfund Membership Packages
- Hyperfund raised $1.7 Billion From Investors
- Securities And Exchange Commission filed Complaint In Federal District Court
- Brenda Indah Chunga agreed Settle Charges
- Brenda Indah Chunga pleaded Guilty To Conspiracy
- Us Attorney'S Office announced Criminal Charges Against Lee And Chunga
- Securities And Exchange Commission seeks Permanent Injunctive Relief
- David Snyder And Assunta Vivolo conducted Investigation
PDF (from attached: complaint)
Text layers
Extracted body text (2,820c)
U.S. SECURITIES AND EXCHANGE COMMISSION Litigation Release No. 25933 / January 30, 2024 Securities and Exchange Commission v. Xue Samuel Lee, a/k/a “Sam” Lee and Brenda Indah Chunga, a/k/a “Bitcoin Beautee,” No. 1:24-cv-00296-RDB (D. Md. filed Jan. 29, 2024) SEC Charges Founder of $1.7 Billion “HyperFund” Crypto Pyramid Scheme and Top Promoter with Fraud The Securities and Exchange Commission today charged Xue Lee (aka Sam Lee) and Brenda Chunga (aka Bitcoin Beautee) for their involvement in a fraudulent crypto asset pyramid scheme known as HyperFund that raised more than $1.7 billion from investors worldwide. According to the SEC’s complaint, from June 2020 through early 2022, Lee and Chunga promoted HyperFund “membership” packages, which they claimed guaranteed investors high returns, including from HyperFund’s supposed crypto asset mining operations and associations with a Fortune 500 company. As the complaint alleges, however, Lee and Chunga knew or were reckless in not knowing that HyperFund was a pyramid scheme and had no real source of revenue other than funds received from investors. In 2022, the HyperFund scheme collapsed and investors were no longer able to make withdrawals. The SEC’s complaint, filed in federal district court in the District of Maryland, charges Lee and Chunga with violating the anti-fraud and registration provisions of the federal securities laws. The complaint seeks permanent injunctive relief, conduct-based injunctions preventing the defendants from participating in multi-level marketing or crypto asset offerings, disgorgement of ill-gotten gains, prejudgment interest, and civil penalties. Chunga agreed to settle the charges, to be permanently enjoined from future violations of the charged provisions and certain other activity, and to pay disgorgement and civil penalties in amounts to be determined by the court at a future date. The settlement is subject to court approval. The charges against Lee will be litigated. In a parallel action, the U.S. Attorney’s Office for the District of Maryland today announced criminal charges against Lee and Chunga. Chunga pleaded guilty to conspiracy to commit securities fraud and wire fraud. The SEC’s ongoing investigation is being conducted by David Snyder and Assunta Vivolo, assisted by Tom Bedkowski, of the SEC’s Crypto Assets & Cyber Unit (CACU). It is being supervised by David Hirsch and Jorge Tenreiro of the CACU and Nicholas Grippo and Scott Thompson of the Philadelphia Regional Office. The litigation will be conducted by Judson Mihok and Gregory Bockin of the Philadelphia Regional Office. The Commission appreciates the assistance of the U.S. Attorney’s Office for the District of Maryland; the Department of Justice, Fraud Section; Homeland Security Investigations New York; and the IRS. SEC Complaint
OCR text (2,820c · html-text · 99% conf)
U.S. SECURITIES AND EXCHANGE COMMISSION Litigation Release No. 25933 / January 30, 2024 Securities and Exchange Commission v. Xue Samuel Lee, a/k/a “Sam” Lee and Brenda Indah Chunga, a/k/a “Bitcoin Beautee,” No. 1:24-cv-00296-RDB (D. Md. filed Jan. 29, 2024) SEC Charges Founder of $1.7 Billion “HyperFund” Crypto Pyramid Scheme and Top Promoter with Fraud The Securities and Exchange Commission today charged Xue Lee (aka Sam Lee) and Brenda Chunga (aka Bitcoin Beautee) for their involvement in a fraudulent crypto asset pyramid scheme known as HyperFund that raised more than $1.7 billion from investors worldwide. According to the SEC’s complaint, from June 2020 through early 2022, Lee and Chunga promoted HyperFund “membership” packages, which they claimed guaranteed investors high returns, including from HyperFund’s supposed crypto asset mining operations and associations with a Fortune 500 company. As the complaint alleges, however, Lee and Chunga knew or were reckless in not knowing that HyperFund was a pyramid scheme and had no real source of revenue other than funds received from investors. In 2022, the HyperFund scheme collapsed and investors were no longer able to make withdrawals. The SEC’s complaint, filed in federal district court in the District of Maryland, charges Lee and Chunga with violating the anti-fraud and registration provisions of the federal securities laws. The complaint seeks permanent injunctive relief, conduct-based injunctions preventing the defendants from participating in multi-level marketing or crypto asset offerings, disgorgement of ill-gotten gains, prejudgment interest, and civil penalties. Chunga agreed to settle the charges, to be permanently enjoined from future violations of the charged provisions and certain other activity, and to pay disgorgement and civil penalties in amounts to be determined by the court at a future date. The settlement is subject to court approval. The charges against Lee will be litigated. In a parallel action, the U.S. Attorney’s Office for the District of Maryland today announced criminal charges against Lee and Chunga. Chunga pleaded guilty to conspiracy to commit securities fraud and wire fraud. The SEC’s ongoing investigation is being conducted by David Snyder and Assunta Vivolo, assisted by Tom Bedkowski, of the SEC’s Crypto Assets & Cyber Unit (CACU). It is being supervised by David Hirsch and Jorge Tenreiro of the CACU and Nicholas Grippo and Scott Thompson of the Philadelphia Regional Office. The litigation will be conducted by Judson Mihok and Gregory Bockin of the Philadelphia Regional Office. The Commission appreciates the assistance of the U.S. Attorney’s Office for the District of Maryland; the Department of Justice, Fraud Section; Homeland Security Investigations New York; and the IRS. SEC Complaint