U.S. SEC Sues $22 Million Crypto Mining Scam, With Over 380 Investors Implicated

U.S. Securities and Exchange Commission (SEC) announced it has filed a lawsuit against Florida resident Zan Shaikh and his firm Mining Automatic, accusing them of raising roughly $22 million from more than 380 investors via a fraudulent cryptocurrency mining investment scheme and misappropriating investor funds. The SEC noted that between June 2023 and May 2025, the defendants promised investors guaranteed monthly returns from crypto mining, but in practice only deployed about 13% of the raised capital to the purported mining operations, with the remainder largely used for marketing, attracting new investors, and covering personal and other unrelated business costs. The SEC added that the total funds raised by the defendants are at least $20 million higher than the amount returned to investors. The SEC has charged them with violating anti-fraud and securities issuance provisions under the U.S. Securities Act of 1933 and the Securities Exchange Act of 1934. Both parties have agreed to accept a permanent injunction once court-approved; the court will determine the amount of subsequent illegal proceeds to be repaid, interest, and civil penalties.