After failing to reply to an SEC lawsuit filed in opposition to him, Trevon James has requested a courtroom to put aside a recorded entry of default.
In a six-page October 18th filed pro-ser letter, James has additionally knowledgeable the courtroom he doesn’t “have the Bitcoin to liquidate to be able to pay these fines.”
James, who identifies himself as Trevon Brown, married and a father of three, claims being sued by the SEC “is the worst factor that ever occurred to me”.
BitConnect was a multi-billion MLM crypto Ponzi that James, as a prime promoter, is accused of stealing thousands and thousands by means of.
Even after BitConnect’s fraud was specified by courtroom and its executives indicted and despatched to jail, James maintains his expertise with BitConnect “was nice”.
To that finish, the SEC sued James and several other different BitConnect promoters in 2021. On the request of the SEC, the courtroom clerk recorded an Entry of Default in opposition to James on August twenty sixth, 2024.
In September 2024, the SEC revealed default judgment penalties in opposition to James totalling $3.5 million.
States James (proper) in his letter to the courtroom;
Wanting again, there isn’t any query that that is the worst factor that has ever occurred to me.
Not even Bitconnect itself as a result of that have was nice. It’s what the SEC did to bitconnect is what makes it the worst factor that ever occurred to me.
The SEC’s cost of Bitconnect ruined my life and my status within the cryptocurrency area.
To my followers I used to be the humorous crypto fanatic who enjoys the know-how and simply loves to talk and make jokes about it, all whereas attempting to foretell the path the crypto area goes.
All of that has been torn aside and I discover it onerous to do what I do greatest with the life path I selected of being a video manufacturing persona.
Now I’m “that scammer man” “the bitconnect scammer” “BITCONNNNEEECTTTT!!” “HEY HEY HEYYYYY” “WASSA WASSA WASSAP BITCONNECT!!!!”.
In case you are unfamiliar with the final three quotes these are jokes which are mentioned indefinitely on-line to the individuals who participated within the coin to remind them of their loses.
Whether or not it’s monetary loss or status. I nonetheless until at the present time should cope with commenters on-line and in public who should remind me that I’m now thought-about a scammer, although I by no means took something from anybody.
As an alternative of acknowledging the victims he stole from, James has a cry to the courtroom over his YouTube profession being devastated.
Now for the common particular person, positive it’s just a bit on-line bullying that could possibly be ignored. However for me, somebody who’s attempting to have a profession in reporting on cryptocurrency this has been very damaging.
And to be referred to as the Bitconnect scammer while you google my actual first and center identify is mortifying. I’ve by no means scammed anybody in my life!
I didn’t know [BitConnect] would finish prefer it did as a result of I had by no means seen something just like the collapse of Bitconnect earlier than in my life.
I didn’t even study what the SEC was till I needed to study what a subpoena was. I’m not on the company stage so it was all new to me and I’ve realized rather a lot.
BitConnect collapsed in January 2018, wiping $2.4 billion of the BCC Ponzi token throughout ten days.
James goes on to argue the SEC’s case in opposition to him must be dismissed in its entirety, as a result of the BitConnect Ponzi scheme is “identical to bitcoin”.
I’m not defending the creators of Bitconnect as a result of I don’t know them or their intentions, however Bitconnect is mined identical to Bitcoin is mined, and Bitcoin has gotten the cross from the SEC as “not a safety” so primarily based on that alone I believe this case in opposition to me must be dismissed.
Regardless of the SEC not submitting expenses in opposition to BitConnect till three years after it collapsed, James blames the SEC’s 2021 filed lawsuit for BitConnect’s 2018 collapse (observe there aren’t any editorial errors in that final sentence).
Bitconnect collapsed after the SEC charged it as a result of the holders of the coin offered it off closely, and by no means appeared again.
The loses in Bitconnect had been the results of the SEC scaring contributors out. The principles/legal guidelines the SEC is utilizing to cost me are historical legal guidelines from the 1940’s.
Tv was barely a factor when these legal guidelines had been put in place not to mention computer systems or web.
For the file, the Securities and Trade Act was ratified in 1933. What this has to do with James violating US securities regulation by means of BitConnect is unclear.
Securities are securities, whatever the medium they’re supplied by means of.
Regardless of professing his innocence, James does seem able to recognizing his fraud.
Days or perhaps weeks cross and I get a letter from the SEC. This era could be very blurry for me to recall as a result of it was all so way back and new to me on the time.
However I ultimately obtained a subpoena to return testify as a witness within the case in opposition to Bitconnect in New York and was requested to see all my wallets and transactions.
In the course of the interview I answered all questions up till they began to play again to me a few of my movies the place I began to say issues within the video that I may see could possibly be taken out of context to be able to use what I mentioned in these movies, in opposition to me.
One explicit half was had been I mentioned individuals had “misplaced cash”. Being not sure of their angle for asking me about why I mentioned that, I utilized my proper to stay silent.
5 pages into James’ letter, we get to the related authorized level. Albeit with James’ continued basic misunderstanding of the securities fraud he’s been charged with;
I didn’t notice I had a deadline to reply or I might have as a result of I at all times have.
So I’m writing to ask you to finish this case as a result of I don’t have the Bitcoin to liquidate to be able to pay these fines.
So far as disgorgment [sic], they’re asking me to pay them primarily the quantity of Bitcoin that was hacked from me, which is outrageous and merciless as a result of they know I don’t have it, and even have proof I don’t have it in their very own paperwork.
It’s price noting that since BitConnect’s collapse, James bought a home in South Carolina and a BMW luxurious SUV. In August 2019, James requested his YouTube channel viewers for recommendation on investing 1,000,000 {dollars} into real-estate.
On his YouTube channel, James has additionally after all continued to doc and promote his funding into quite a few fraudulent crypto funding schemes.
How can I payback what I don’t have. And the way do any of us know I have to pay something again if there aren’t any legal guidelines for cryptocurrencies.
Simply because some early crypto lovers determined to name blockchain ledgers “forex”, the SEC will get to implement financial legal guidelines onto what are actually spreadsheets?
Every blockchain is a spreadsheet copied to 1000s of computer systems in a decentralized method in order that it may’t be deleted. They didn’t know these would exist within the Nineteen Forties.
We’d like legal guidelines for crypto and hopefully this case, together with the others occurring proper now with the SEC, may also help us as a rustic provide you with new guidelines and laws for this new know-how.
I’ve already paid for this by means of my status and stress over the previous 7 years.
In case you see that dismissing this case is just not justice please prolong the case and have me present you the proof that you could see to dismiss it.
I wouldn’t thoughts talking with you nose to nose at a trial which I believe is healthier than this anyway as a result of I’m positive you’ve got questions for me.
I’ve no downside with being barred from collaborating in securities as a result of I’ve by no means achieved that anyway.
And for the disgorgement the one method I may pay that is if the FBI actually has my BTC.
I used to be irresponsible in not getting illustration earlier and once I’ve tried to get illustration everybody I requested mentioned they aren’t certified for the sort of case or it’s too far alongside at this level.
I belief that you simply see what’s really occurring right here between me and the SEC. In any case, I began out as a witness in all this.
The SEC filed its response to James’ letter on October twenty ninth. In its response, the SEC acknowledged James’ “request to maneuver to dismiss [its] Grievance”.
The regulator additionally laid out why Brown’s request was “meritless”.
Brown’s contemplated movement to dismiss lacks advantage. The Brown Letter consists largely of a recitation of purported details that, even when true and related to the Fee’s claims (which they aren’t), can be inappropriate for consideration on a movement to dismiss.
The only argument Brown raises that purports to deal with the sufficiency of the Grievance’s allegations and that subsequently may correctly be thought-about on a movement to dismiss is his competition that the BitConnect Lending Program didn’t meet the definition of “securities” below the federal securities legal guidelines. Brown Ltr. at 3, 5.
This argument, nevertheless, is meritless.
For the explanations mentioned within the Fee’s papers in assist of its default judgment movement in opposition to Brown, the Grievance greater than adequately alleges that the BitConnect Lending Program constituted an “funding contract” below SEC v. W.J. Howey Co., 328 U.S. 293 (1946) and subsequently met the definition of a safety below Part 2(a)(1) of the Securities Act of 1933, 15 U.S.C. § 77b(a)(1), and Part 3(a)(10) of the Securities Trade Act of 1934, 15 U.S.C. 78c(a)(10).
Following a November thirteenth phone convention, the courtroom granted James permission to file a movement to dismiss by December thirteenth. The courtroom has additionally referred the matter to a Justice of the Peace Choose to discover potential settlement.
As at time of publication, James stays a pro-se defendant with out authorized illustration.