The US-based cryptocurrency mining venture raised about $22 million from more than 380 investors and then spent just 13 cents of every dollar on its nominal mining operations, the SEC alleges.
The regulator filed a partially settled complaint on July 20 against Zan Shaikh and Bright Vision Distribution LLC, doing business as Mining Automatic. According to the SEC’s complaint, the defendants promised monthly revenues from approximately June 2023 to May 2025, even though the purported mining operations were not set up to generate that level of revenue.
The SEC alleges that Shaikh and Mining Automatic received at least $20 million more than they repaid investors. The investors’ funds were used primarily for Shaikh’s personal expenses and unrelated business expenses, as well as for marketing to attract new investors.
Mr. Shaikh and Mining Automatic agreed to the proposed permanent injunction, subject to court approval. Shaikh also agreed to an injunction based on officer and director prohibition and conduct. If the court approves the consent decree, disgorgement, prejudgment benefits, and civil penalties would later be determined based on the SEC’s motion. Distributions and returns to investors have not been announced and remain uncertain.
FBI cooperation may further expand known sources
A separate FBI victim information page states that the agency’s Boston division is looking for potential victims associated with Shaikh, Bright Vision Distribution, YT Automatic, and Mining Automatic.
The survey also names RankOne Ecommerce and Replica8 among Shaikh and its affiliates, but does not specify their relationship with each other, and investors are primarily targeted from 2022 to 2025.
The FBI’s actions are broader than the SEC’s lawsuit, targeting more than 380 investors who were allegedly promised guaranteed profits from around June 2023 to around May 2025. More victims may come forward, but the FBI has not updated the total amount or indicated that anyone might recover their funds.
The FBI says the submission is voluntary, could aid the investigation, and investigators may request further information. Victims may be entitled to services, compensation, and rights under federal or state law. The form submission is an information gathering stage and the official claim status remains unspecified.
The next formal step is a court review of the proposed sentence. If these are approved, the SEC could move to ask the court to set monetary relief, although the amount investors will ultimately recover remains unclear.
