BK Coin Management, LLC is connected through Kevin Kang to BKCoin Capital but the SEC makes no mention of that sister company. Let's call them "management" and capital". The latter company's website is at http://www.bkcoincapital.com/ but as of the time of writing clicking the link goes straight to google.com and a blank search page.

It is alleged that "From at least October 2018 through September 2022, BKCoin raised approximately US100 million from at least 55 investors to invest in crypto assets, but BKCoin and Kang instead used some of the money to make Ponzi-like payments and for personal use."

That's where it gets interesting because Crunchbase says of Capital "BK Coin Capital is a digital asset hedge fund dedicated to delivering consistent, absolute returns through systematic arbitrage strategies." It also says the company is headquartered in New York whereas the SEC says that Management is based in Miami.

The SEC alleges (edited) in a statement issued 6th March:

According to the SEC’s complaint, filed under seal on 23 February, 2023, and unsealed today, BKCoin and Kang assured investors that their money would be used primarily to trade crypto assets and represented that BKCoin would generate returns for investors through separately managed accounts and five private funds [but] the defendants disregarded the structure of the funds, commingled investor assets, and used more than USD3.6 million to make Ponzi-like payments to fund investors. The complaint also alleges that Kang misappropriated at least USD371,000 of investor money to, among other things, pay for vacations, sporting events tickets, and a New York City apartment."

So, pretty standard "hedge fund" stuff in the USA, it seems. It also seems as if "crypto" had nothing to do with the fraud.

More from the SEC:

Kang attempted to conceal the unauthorised use of investors' money by providing altered documents with inflated bank account balances to the third-party administrator for certain of the funds. The SEC further alleges that BKCoin materially misrepresented to some investors that BKCoin, or one of the funds, received an audit opinion from a “top four auditor,” when in fact neither BKCoin nor any of the funds received an audit opinion at any time.

The SEC alleges that BKCoin and Kang breached the antifraud provisions of the federal securities laws. The complaint seeks permanent injunctions against both of the defendants; surrender of profits, pre-judgment interest and a civil penalty from both of the defendants. It also seeke that Kang be barred from being an officer and/or director bar. The complaint names as relief defendants, and seeks surrender of profits from, each of the funds and Bison Digital LLC, an entity that allegedly received approximately USD12 million from BKCoin and the funds. The court also granted emergency relief against the relief defendants, which the SEC sought, including appointment of a receiver.

So, what about Capital. Crunchbase doesn't define the legal status so we don't know if it's incorporated or otherwise registered nor if such fund as it seems to was involved. The only thing we know from desk research is that its website doesn't work, that it was started by three people and that meant it could register as a "black led", "hispanic" and "east Asian" company. We also know that the SEC's investigation is conducted entirely by a team from Miami.

And we know that "crypto" might as well have been dishwasher tablets for all the part if played in the alleged fraud. It was simply a product that the defendants said they were trading in.