BitSports has been issued an emergency cease and desist order from the Texas State Securities Board (TSSB).

TSSB issued
the November 9th order
after confirming BitSports is committing securities fraud.

As reviewed here on BehindMLM in May,
BitSports
was an AI bot Dubai-based Ponzi scheme.

BitSports
collapsed
last month, which is noted in TSSB’s order;

BitSports.ai recently announced it was the victim of a cybersecurity incident impacting nearly 55,000 of its clients. It claims the malicious actor stole digital assets from its wallets.

The firm suspended client withdrawals and then suspended its operations.

In addition to naming BitSports’ CEO Hugo Rodriguez and executives Carlos Sarmiento and Denissa Salas…

…TSSB also names promoters Josh Berman and Sean Kelly.

Together, Berman and Kelly promoted BitSports through their company Berman Investment Group (BIG).

In addition to having a website, BIG also has a corresponding YouTube channel. On the Berman Investment Group YouTube channel, multiple fraudulent MLM investment scams are promoted:

Incomation
,
Daisy AI
,
iX Global
,
NovaTech FX
and
Automated Capital
are all fraudulent MLM investment schemes.

Other schemes TSSB tie to BIG’s promotional efforts include Mirror Trading International (a collapsed $1.7 billion Ponzi) and
GSPartners
(a Dubai Ponzi
under investigation by the CFTC and SEC
).

Following their own investigation into BitSports, TSSB concluded the company’s investment scheme has

not been registered with the Securities Commission as dealers or agents at any time material hereto.

Parties offering (BitSports’) Arbitrage Memberships in or from Texas are offering unregistered securities in violation of Section 4003.001 of the Securities Act.

Parties offering (BitSports’) Arbitrage Memberships in or from Texas are offering securities in violation of Section 4004.051 of the Securities Act unless the parties registered as dealers or agents.

Several disclosure failings related to BitSports’ purported business operations are also cited.

With respect to the Berman Investment Group, Josh Berman and Sean Kelly, TSSB cites disclosure failures related to

the business repute and qualifications of BIG, Berman and Kelly;

the experience and success of BIG, Berman and Kelly;

MLM commissions earned by Berman and Kelly for recruiting consumers into fraudulent investment schemes; and

the “criteria used to identify, analyze, and determine whether to promote investments”

TSSB goes on to order BitSports, its executives, Berman, Kelly and BIG to

immediately CEASE AND DESIST from offering for sale any security in Texas until the security is registered with the Securities Commissioner or is offered for sale pursuant to an exemption from registration under the Texas Securities Act.

It is further ORDERED that Respondents immediately CEASE AND DESIST from acting as securities dealers, agents, investment advisers, or investment adviser representatives in Texas until they are regist

🤖 Quick Answer

What is the BitSports securities fraud case?
BitSports, a Dubai-based AI bot Ponzi scheme, received an emergency cease and desist order from Texas State Securities Board on November 9th for securities fraud. The company collapsed after a cybersecurity breach affecting 55,000 clients. CEO Hugo Rodriguez and executives Carlos Sarmiento and Denissa Salas were named, along with promoters Josh Berman and Sean Kelly.

Why did BitSports suspend operations?
BitSports suspended client withdrawals and operations following a cybersecurity incident that compromised digital assets in its wallets, affecting approximately 55,000 clients. The breach led to the firm's collapse and subsequent regulatory action by Texas authorities.

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