Washington State DFI Alleges Fake Investment Education Foundations and Trading Platforms Defrauded Investors Out of Nearly $9.9 Million in Cryptocurrency Scams

OLYMPIA – The Washington State Department of Financial Institutions (DFI) filed a Statement of Charges against investment education foundations, including Zenith Asset Tech Foundation, for multiple violations of the Securities Act between 2024 and 2025 and participation in alleged cryptocurrency scams.

DFI alleges that scammers defrauded investors through elaborate cryptocurrency scams that utilized fake education foundations, fake securities token offerings, fake AI generated investment trading signals, and fake trading platforms. At least 38 investors lost nearly $9.9 million in these scams, including three Washington residents who invested approximately $49,000.

“It’s more important than ever for regulatory agencies like DFI to take enforcement action like this in an effort to protect people from losing their life savings,” DFI Director Charlie Clark said. “Federal Trade Commission data shows Americans reported losing nearly $16 billion to fraud in 2025 — an increase of more than $3.5 billion over the previous year. That’s unconscionable to us.”

The alleged fraudulent investment education institutions (“Foundation Respondents”) advertised on social media, including Facebook, Instagram, and LinkedIn, claiming to provide free investment training and touting AI systems that could provide investors with “trade signals” that effectively timed the cryptocurrency investment markets. The Foundation Respondents distributed training lectures and trade signals to investors in chat groups on WhatsApp and Telegram. 

The Foundation Respondents then invited interested investors to place test trades in cryptocurrency on designated trading platforms accessible from both websites and apps (“Platform Respondents”). The Platform Respondents were incorporated in Washington to make them appear more legitimate, and prompted investors to invest their personal funds by showing fake profits. 

The Foundation and Platform Respondents also designated unregistered third parties to assist investors with converting investment funds into cryptocurrencies and depositing them into investor accounts at the trading platforms. 

The Platform Respondents further defrauded investors through advance fee scams, requesting various previously-undisclosed fees before investors could withdraw any funds. In desperation, many investors paid the advance fees, but none received any of their investment funds back.

The Statement of Charges announces DFI’s intent to order the Respondents to cease and desist from violations of the Securities Act, to pay fines totaling $1 million, and to pay costs related to the investigation.

Related: Washington DFI Warns of Cryptocurrency Scams Involving Fake ‘Investment Education Foundations’ and AI Bots