Connect with us

Hi, what are you looking for?


Crypto Mining Investor B.Riley Facing SEC Probe

B.Riley, an investment firm that has backed numerous Bitcoin mining projects, is allegedly involved in a probe brought forth by the United States Securities and Exchange Commission (SEC), according to a new report from Bloomberg.

B.Riley’s deals in question following business with alleged co-conspirator

The report, released January 21st, alleges that B. Riley helped to broker last year’s buyout of Franchise Group Inc. on behalf of Brian Kahn, a co-conspirator in the Department of Justice’s Prophecy Asset Management case, wherein “some of Kahn’s assets” were “pledged as collateral.” Japanese financial group Nomura “partly financed the transaction,” which was estimated to be $2.6 billion.As of Monday morning, B.Riley’s stock was down by nearly 11% following the news.“B. Riley Financial is not aware of any such SEC investigation regarding any of these matters and, in the event one were to materialize, would cooperate fully with it,” the investment firm said in a January 22nd statement.

Hundreds of millions stolen from Prophecy Asset Management clients

In November 2023, Prophecy Asset Management co-founder, John Huges, pleaded guilty to defrauding clients out of $294 million. Hughes stated he worked with two co-conspirators, with sources identifying them as Kahn and Prophecy Asset Management CEO Jeffery Spotts.“At no time during my former business relationship with Prophecy did I know that Prophecy or its principals were allegedly defrauding their investors, nor did I conspire in any fraud,” Khan said in a statement last November reported by Bloomberg. “Like many other investors, my relationship with Prophecy was costly, including economically, and I ceased doing business with Prophecy several years ago. In no way, shape of form has this previous relationship impacted Franchise Group.

B.Riley takes aim at short sellers

Meanwhile, B. Riley denied any involvement in the multi-year fraud that saw hundreds of millions of dollars concealed from investors.“As B. Riley stated in November 2023 when it first learned of the Prophecy investigation, B. Riley Financial had no involvement with, or knowledge of, any of those matters,” the statement continued. “The short sellers continue to disseminate false information for their own profit to the detriment of the Firm’s clients and customers.”Last March, Core Scientific’s Chapter 11 bankruptcy process accepted a $70 million from B.Riley. Moreover, the investment firm finalized a deal with Iris Energy, wherein B.Riley may buy up to $100 million worth of equity from the Australian Bitcoin miner.Representatives from the SEC and Nomura declined to comment on the matter.

The post Crypto Mining Investor B.Riley Facing SEC Probe appeared first on Cryptonews.

You May Also Like

Editor's Pick

Real gross domestic product rose at a revised 3.2 percent annualized rate in the third quarter versus a 0.6 percent rate of decline in...

Editor's Pick

In Risky Business: Why Insurance Markets Fail and What to Do About It (Yale University Press, 2023), economists Liran Einav (Stanford), Amy Finkelstein (MIT),...

Editor's Pick

For years the North Korean playbook was obvious to the world. The Democratic People’s Republic of Korea wanted to be the center of attention....

Editor's Pick

After the final lecture of my Fall 2022 International Economic Policy course (an undergraduate offering meant to introduce non-economics majors to the economics of...

Disclaimer:, its managers, its employees, and assigns (collectively “The Company”) do not make any guarantee or warranty about what is advertised above. Information provided by this website is for research purposes only and should not be considered as personalized financial advice. The Company is not affiliated with, nor does it receive compensation from, any specific security. The Company is not registered or licensed by any governing body in any jurisdiction to give investing advice or provide investment recommendation. Any investments recommended here should be taken into consideration only after consulting with your investment advisor and after reviewing the prospectus or financial statements of the company.

Copyright © 2023