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It’s hard to imagine an easier financial fraud to run these days than a cryptocurrency scam. People just can’t get enough of them. And yet, when Florida man Edgar Radjabli decided to “tokenize” interests in his fund, Apis Capital Management—which describes itself in equally irresistible ways to the eager sucker as an investment strategy that leverages “machine learning algorithmic technology”—he either failed or never really tried, according to the SEC.

Radjabli and Apis Capital issued a June 2018 press release falsely claiming that the Apis Token offering had raised $1.7 million when, in fact, the offering had raised no money.

What a rube! you must be thinking. What an absolute bungler! How could you screw something like that up? In Florida, no less, where people line up to get COVID-19 and commune with their fellow cryptoffionados! How does this man manage even to get out of bed in the morning? Feed himself? Remember to breath?

But you would (allegedly) be wrong about Mr. Radjabli, because not only can he (allegedly) successfully run such a scheme, he can run two such schemes!

The complaint further alleges that Radjabli and Apis Capital manipulated the securities market for Veritone Inc., a publicly-traded artificial intelligence company, by announcing in December 2018 an unsolicited cash tender offer to purchase Veritone for $200 million, when, in truth, Radjabli and Apis Capital lacked the financing or any reasonable prospect of obtaining the financing necessary to complete the deal. Radjabli allegedly generated $162,800 in illicit profits on the resulting increase in Veritone’s stock price by trading Veritone securities on behalf of Apis Capital and an affiliated fund.

Finally, the complaint alleges that Radjabli raised nearly $20 million from more than 450 investors in an unregistered, fraudulent securities offering launched in August 2019 through My Loan Doctor LLC. Radjabli falsely represented that investor funds raised by Loan Doctor would be used to originate loans to healthcare professionals which then would be securitized and sold to large institutional investors. Instead, Radjabli allegedly invested the bulk of the investor funds in unsecured and uninsured loans to digital asset lending firms and loaned almost $1.8 million of investor proceeds to Apis Capital.

Nor, we imagine, based on the first of these “three separate frauds,” as the SEC puts it, would you imagine that Radjabli could possibly have the ability and wherewithal to be a healthcare professional himself. And yet!

Radjabli, formerly a practicing dentist….

We guess there are worse things you can be than a dentist.

SEC Charges Dentist-Turned-Investment Adviser for Three Separate Frauds [press release]
Bitcoin conference attendees report testing positive for Covid after returning from Miami [CNBC]

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By Chris Potter (Flickr: 3D Judges Gavel) [CC BY 2.0], via Wikimedia Commons

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