The U.S. Securities and Exchange Commission has filed a civil action against two companies accused of using falsified regulatory filings to give a crypto investment program the appearance of official legitimacy. In an October 29 announcement, the regulator said BG Wealth Sharing and DSJ Exchange submitted disclosures that promoters then presented to investors as proof of government authorization. A KuCoin News flash report detailed the allegations.

According to the SEC, the alleged operation collected more than $130 million from tens of thousands of investors in the United States and abroad. The agency's civil complaint states that the companies operated from at least October 2025 through June 2026, while investigators traced collections across more than 223,000 blockchain addresses between March and early June 2026.

Filings Presented as Evidence of Approval

The SEC alleges that BG Wealth filed Form ADV to claim status as an exempt reporting adviser, while DSJ Exchange submitted a Form D for a purported $100 million securities offering. Both filings appeared in the SEC's Investment Adviser Public Disclosure system and the EDGAR database, giving promoters government-hosted records they could point to when courting investors.

The two forms are standard SEC paperwork: Form ADV is the filing used to register an investment adviser or claim exempt reporting adviser status, and Form D is the notice filed for certain securities offerings. Submission places a document in the public record; it does not, by itself, trigger an agency review or endorsement. That gap between visibility in a government database and actual regulatory authorization is what the complaint places at the center of the alleged scheme.

The complaint states that neither company held SEC registration or a license, and that the filings themselves conferred no regulatory approval. The agency said the companies also distributed fabricated registration certificates bearing the SEC's seal and identifiers matching the filings, reinforcing the program's appearance of legitimacy.

BG Wealth allegedly billed itself as the world's largest hedge fund and claimed to operate as an SEC-licensed investment adviser. It also claimed that proprietary trading technology generated signals with 99.6% accuracy. DSJ Exchange, for its part, claimed that a secure trading platform executed profitable trades, but investigators alleged that its transactions, profits and account increases were fictitious.

Promised Returns and Blocked Withdrawals

The SEC said the program promised monthly returns of at least 60% and assured investors they could double their money within 40 days without risk. Investigators alleged that no genuine trading took place and that the companies diverted most deposits rather than investing them as promised.

Ponzi-like payments returned no more than $25 million to addresses likely controlled by investors, according to the SEC, which says most of the remaining funds were misappropriated. The report puts alleged investor losses at more than $100 million, with recovery still unresolved.

Promoters allegedly recruited participants through social media, encrypted messaging services, weekly video conferences and incentives for bringing in new members. When investors sought withdrawals, the companies allegedly charged fees of up to 20%, then delayed payouts and ultimately blocked access to funds. The defendants later requested additional payments for taxes and urged investors to move assets to HQI Exchange, another platform. Withdrawal access remained unavailable, according to the report.

The case adds to a series of reported allegations involving crypto investment schemes, including the Goliath Ventures case and investor claims over account handling. A separate report described losses tied to Key Coin Assets.

SEC Seeks Court Relief

The SEC has removed BG Wealth's Form ADV and DSJ Exchange's Form D from its public websites — withdrawing the records promoters had cited as proof of authorization — and filed a civil action against both companies in the Northern District of California. The lawsuit seeks permanent injunctions, financial penalties and repayment of allegedly unlawful gains with interest.

The agency also asked the court to bar BG Wealth from filing Form ADV as an exempt reporting adviser in the future. These remain requests within the SEC's complaint; the report does not indicate a court ruling or any investor recovery. The case's next step therefore rests with the court's consideration of the requested relief.