{"id":48325,"date":"2026-07-22T07:04:27","date_gmt":"2026-07-22T07:04:27","guid":{"rendered":"https:\/\/cryptomag.finance\/?p=48325"},"modified":"2026-07-22T07:04:27","modified_gmt":"2026-07-22T07:04:27","slug":"sec-files-suit-alleging-22000000-crypto-mining-fraud-scheme","status":"publish","type":"post","link":"https:\/\/cryptomag.finance\/?p=48325","title":{"rendered":"SEC Files Suit Alleging $22,000,000 Crypto Mining Fraud Scheme"},"content":{"rendered":"

\"\"<\/p>\n

US regulators have targeted an alleged investment scheme that promised guaranteed returns from crypto mining but delivered far less than advertised.<\/p>\n

The Securities and Exchange Commission (SEC) is suing<\/a> Mining Automatic and founder Zan Shaikh, alleging the Massachusetts-based operation raised $22 million from hundreds of investors between 2023 and 2025.<\/p>\n

\u201cMining Automatic\u2019s website represented that it offered investors the opportunity to obtain recurring passive income by relying on its expertise in crypto asset mining. The website claimed that its \u2018advanced operations,\u2019 \u2018cutting edge technology,\u2019 and \u2018exclusively sourced, low-cost energy\u2019 enabled it to \u2018deliver consistent returns\u2019 in a \u2018future proof\u2019 and \u2018secure\u2019 manner. The website also claimed that Mining Automatic had obtained \u2018annual returns\u2019 of 51.5% in 2021, 46.2% in 2022 and 51.8% in 2023.\u201d<\/em><\/p>\n

The regulator claims that only about 13% of funds went toward actual mining operations, which generated roughly $1.1 million while paying out $1.8 million to investors, creating Ponzi-like characteristics.<\/p>\n

The SEC alleges that investor money was spent on marketing and Shaikh splurged the funds on real estate, vehicles and personal accounts.<\/p>\n

\u201cDespite promising to use investors\u2019 funds to engage in crypto asset mining, Defendants spent approximately $7 million of the $22 million in Mining Automatic investments on marketing and advertising efforts to attract new investors. Defendants also spent about $500,000 of investors\u2019 money on Shaikh\u2019s unrelated business ventures.<\/em><\/p>\n

In addition, Defendants spent significant sums from the investor funds through bank accounts and on credit cards on personal expenses for Shaikh, including real estate charges ($375,575), entertainment ($76,547), a car dealership ($151,750), and cash withdrawals ($118,585). Defendants also transferred $778,550 to bank accounts owned by Shaikh.\u201d<\/em><\/p>\n

The SEC alleges that payments stopped by March 2025 and that no one from the pool of 380 investors got their original investment back, leaving more than $20 million in principal unpaid.<\/p>\n

The SEC seeks disgorgement, penalties and bans on Shaikh from securities activities or corporate roles.<\/p>\n

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Disclaimer: Opinions expressed at The Daily Hodl are not investment advice. Investors should do their due diligence before making any high-risk investments in Bitcoin, cryptocurrency or digital assets. Please be advised that your transfers and trades are at your own risk, and any losses you may incur are your responsibility. The Daily Hodl does not recommend the buying or selling of any assets including cryptocurrencies, nor is The Daily Hodl an investment advisor. Please note that The Daily Hodl participates in affiliate marketing.<\/h6>\n<\/div>\n

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The post SEC Files Suit Alleging $22,000,000 Crypto Mining Fraud Scheme<\/a> appeared first on The Daily Hodl<\/a>.<\/p>","protected":false},"excerpt":{"rendered":"

US regulators have targeted an alleged investment scheme that promised guaranteed returns from crypto mining but delivered far less than advertised. The Securities and Exchange Commission (SEC) is suing Mining Automatic and founder Zan Shaikh, alleging the Massachusetts-based operation raised $22 million from hundreds of investors between 2023 and 2025. \u201cMining Automatic\u2019s website represented that […]<\/p>\n","protected":false},"author":1,"featured_media":48326,"comment_status":"","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_exactmetrics_skip_tracking":false,"footnotes":""},"categories":[],"tags":[],"class_list":["post-48325","post","type-post","status-publish","format-standard","has-post-thumbnail"],"yoast_head":"\nSEC Files Suit Alleging $22,000,000 Crypto Mining Fraud Scheme - Cryptomag<\/title>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/cryptomag.finance\/?p=48325\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"SEC Files Suit Alleging $22,000,000 Crypto Mining Fraud Scheme - Cryptomag\" \/>\n<meta property=\"og:description\" content=\"US regulators have targeted an alleged investment scheme that promised guaranteed returns from crypto mining but delivered far less than advertised. 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