SEC Sues 38 Entities for False Advisory Firm Filings

The U.S. Securities and Exchange Commission (SEC) has filed a lawsuit against 38 entities for false Form ADV filings. These entities included significant misstatements in their Form ADV submissions made in 2025-2026, with some using names related to crypto and Web3. The lawsuit was filed in the U.S. District Court for Colorado. Form ADV is a document that discloses the business details and ownership structure of investment advisory firms, and its submission does not imply SEC registration. The SEC claims that some defendants accessed the filing system using overseas IP addresses, and there were instances of using false addresses and phone numbers. Investigations revealed that the financial statements of the private funds that the defendants claimed to advise were stated to have been audited by unverified auditors. The SEC also pointed out that fake certificates were posted on the defendants' websites. The list of defendants includes CryptoOrbit Ltd, Pinnacle Crypto Exchange, and Web3 University. The SEC views this case as an abuse of the filing system that exploits interest in new technologies and plans to block actions that lure individual investors through false filings. The SEC has alleged violations of the Investment Advisers Act of 1940 and is seeking permanent injunctions and civil penalties. This action is currently at the civil complaint stage, awaiting the court's judgment.