NEW YORK, Jan 3 (Reuters) – A former chief monetary officer of a number of particular goal acquisition firms (SPACs) has pleaded responsible to embezzling greater than $5 million from them, and dropping virtually all of it buying and selling meme shares and cryptocurrencies.
Cooper Morgenthau, 35, of Fernandina Seaside, Florida, pleaded responsible to at least one depend of wire fraud on Tuesday earlier than U.S. District Decide Paul Engelmayer in Manhattan federal court docket.
Morgenthau faces a potential jail sentence of about six to 7-1/4 years, underneath beneficial federal tips, at his scheduled April 25 sentencing.
He additionally agreed to forfeit $5.11 million and pay an equal quantity in restitution, and settled associated civil fees by the U.S. Securities and Change Fee.
Michael Bowen, a lawyer for Morgenthau, declined to remark.
Authorities mentioned that between June 2021 and August 2022, Morgenthau stole greater than $1.2 million from African Gold Acquisition Corp (AGAC.N), hid the theft by falsifying its account statements, and spent or misplaced all of it in securities buying and selling.
To cowl his losses, Morgenthau then raised $4.7 million from traders in SPACs often called Strategic Metals Acquisition Corp, solely to lose most of it via crypto buying and selling, the SEC mentioned.
African Gold, which relies in New York and was created to purchase a gold mining enterprise, had raised $414 million in a Feb. 2021 preliminary public providing.
It fired Morgenthau final August after he ran out of cash and distributors refused to work for the corporate, the SEC mentioned.
African Gold mentioned on the time it terminated Morgenthau after studying about his “improper withdrawals” and makes an attempt to hide them.
In pleading responsible, Morgenthau “admitted that he breached the belief that he owed to his private and non-private traders,” U.S. Lawyer Damian Williams in Manhattan mentioned in an announcement.
Reporting by Jonathan Stempel in New York
Enhancing by Matthew Lewis
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