Ex-CFO who stole $5M to trade crypto and ‘meme stocks’ gets 3 | Crypto Miami
Ex-CFO who stole $5M to trade crypto and ‘meme stocks’ gets 3 years in prison
Cooper Morgenthau embezzled $5 million from three different companies and lost almost all of it trading cryptocurrencies and “meme stocks.“
The former chief financial officer of a special purpose acquisition company (SPAC) was sentenced to three years in prison after embezzling $5 million, which he used to trade cryptocurrencies and “meme stocks.“
An April 27 press release from the United States Department of Justice said Cooper Morgenthau, the former chief financial officer of African Gold Acquisition Corporation (AGAC), embezzled more than $5 million from three different SPACs: AGAC, Strategic Metals Acquisition Corporation I (SMAC I) and Strategic Metals Acquisition Corporation II between June 2021 and August 2022.
According to a related civil complaint from the U.S. Securities and Exchange Commission (SEC), Morgenthau wired approximately $1.2 million in funds from African Gold to his personal accounts, using the money to trade equities and options of cryptocurrencies and so-called meme stocks.
In doing so, he lost almost all of the funds.
Following the losses, he then provided falsified documents to accountants and an auditor at African Gold ahead of its public filing with the SEC, which led to “material misstatements” in the company’s public financial records.
Meanwhile, Morgenthau raised another $4.7 million from private investors in a SPAC separate from African Gold, based on the fraudulent claim that the money would be used to launch yet another SPAC.
Unfortunately for the investors, Morgenthau used the freshly-raised capital to cover his losses at African Gold and continue further trading of cryptocurrencies and meme stocks.
At the time, SMAC I was in the process of raising money from private investors ahead of its initial public offering.
African Gold discovered the withdrawals in August 2022 , fired Morgenthau, and informed the SEC of his malpractice.
