Debtor Behind $12.5 Million Crypto Ponzi Scheme Denied Bankruptcy Protection

A Texas man who ran a fraudulent cryptocurrency investment scheme has been denied a bankruptcy discharge worth more than $12.5 million, after a court found he concealed assets and lied under oath to evade his creditors.

Nathan Fuller, owner of Privvy Investments LLC, used the company as a front to divert investor funds into luxury spending, gambling trips and a nearly $1 million property purchased for his ex-wife, with whom he continued to live. The US Trustee Program (USTP) confirmed that Fuller’s attempt to use bankruptcy as a shield against creditors failed, after the Bankruptcy Court for the Southern District of Texas entered a default judgment on 1 August.

Investigators found that Fuller had operated Privvy as a Ponzi scheme, fabricating documentation to deceive investors and regulators. He admitted to giving false testimony, falsifying bankruptcy documents and obstructing the work of the trustee appointed to administer both his personal and company bankruptcy cases. Fuller also faced civil contempt proceedings for failing to comply with court orders.

The USTP’s Houston office successfully objected to Fuller’s bankruptcy discharge, citing concealed assets, failure to maintain records and multiple false oaths. As a result of the judgment, Fuller remains personally liable for his debts, including the $12.5 million in unsecured liabilities listed in his bankruptcy filings, leaving creditors free to continue collection efforts.

US Trustee Kevin Epstein of Region 7, which covers the Southern District of Texas, said:

Fraudsters seeking to whitewash their schemes will not find sanctuary in bankruptcy. The USTP remains vigilant for cases filed by dishonest debtors, who threaten the integrity of the bankruptcy system.

The case highlights the increasing scrutiny of fraudulent cryptocurrency investment schemes, which have defrauded thousands of retail investors in recent years. By denying bankruptcy discharge in cases of concealment and fraud, the USTP aims to protect the integrity of the bankruptcy system and ensure victims retain the right to recover funds.

Read the press release here.