SEC Charges BitClout Founder with Fraud

The US Securities and Exchange Commission (SEC) has accused BitCloud founder Nader Al-Naji of fraud for using investors’ funds to pay for luxuries, including rent for a mansion in Beverly Hills.

The SEC alleges that Al-Naji deceived investors about the decentralized nature of the project while raising over $257 million through the unregistered sale of the platform’s native token, BTCLT.

The agency states that Al-Naji spent over $7 million of these funds on personal expenses, such as the rental of a six-bedroom Beverly Hills mansion and extravagant gifts for family members.

In response to the allegations, Gurbir S. Grewal, the director of the SEC’s Division of Enforcement, stated that Al-Naji’s belief that being “fake” decentralized would protect him from regulation was incorrect, as the SEC is guided by economic realities rather than labels.