The U.S. SEC sues two private equity funds: suspected of falsely selling Pre-IPO shares of OpenAI, SpaceX, and misappropriating investor funds

According to Fortune, the U.S. Securities and Exchange Commission (SEC) has filed lawsuits against two private equity fund cases, accusing the relevant fund advisors of raising funds under the pretext of investing in shares of popular tech companies like OpenAI and SpaceX before their IPOs, but allegedly providing false information to investors and misappropriating some of the funds.

The SEC stated that Meyer Global Management and its head Owen Meyer are suspected of raising at least $18.5 million from nearly 100 investors to purchase shares of companies before their IPOs, but misappropriated at least $1.27 million, including using fund money for personal consumption, paying entertainment expenses, and personal investments. Among them, the SEC accused Meyer of establishing a fund for investing in shares of OpenAI and SpaceX, but some of the funds did not actually hold the relevant assets.

In another case, the SEC and federal prosecutors accused Beyond Alpha Ventures heads Christopher Dinelli and Jacob Frankel of raising over $8.7 million from 35 investors and falsely promoting that the fund held shares of companies like SpaceX and xAI. The SEC stated that the two provided false investment reports, with some of the funds being used for options trading, film investments, and personal use. The SEC emphasized that the accused tech companies and their management have not been found to have engaged in misconduct. Regulatory agencies have been continuously monitoring investment products that use "acquiring shares of popular private companies before IPOs" as a selling point and have launched multiple enforcement actions against relevant private equity fund advisors in recent years.