SEC sues Cooper J. Morgenthau for embezzling and stealing funds from SPAC

Rick Steves

“Our complaint against Morgenthau demonstrates our commitment to holding individuals accountable, particularly when they seek to take advantage of public interest in investment vehicles such as SPACs.”

The Securities and Exchange Commission has sued Cooper J. Morgenthau, the former CFO of SPAC African Gold Acquisition Corp.

The agency alleges he orchestrated a scheme in which he stole more than $5 million from the company and from investors in two other SPACs that he incorporated.

Morgenthau allegedly embezzled money and stole funds

From June 2021 through July 2022, Morgenthau allegedly embezzled money from African Gold and stole funds from another SPAC series called Strategic Metals Acquisition Corp. I and II to pay for his personal expenses and to trade in crypto assets and other securities.

The regulator claims the defendant concealed unauthorized withdrawals by falsifying African Gold’s bank account statements and then provided those falsified documents to African Gold’s auditor and accountants for purposes of preparing African Gold’s SEC filings.

During the same general time period, Morgenthau raised money from Strategic Metals’ investors based on misrepresentations that the money would be used to launch the Strategic Metals SPACs, when in fact Morgenthau misappropriated the money for personal uses, including to conceal his embezzlement of African Gold’s funds, the SEC stated.

John T. Dugan, Associate Director for Enforcement in the SEC’s Boston Regional Office, said: “Our complaint against Morgenthau demonstrates our commitment to holding individuals accountable, particularly when they seek to take advantage of public interest in investment vehicles such as SPACs. Our enforcement team worked swiftly and efficiently to file today’s action in just over four months since it was disclosed, which should serve to deter future bad actors in the SPAC market.”

There is an ongoing parallel action by the U.S. Attorney’s Office for the Southern District of New York with criminal charges against Morgenthau.

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