- The US DOJ claimed the ex-CFO embezzled more than $5 million from various SPACs.
- Cooper lost nearly all the stolen funds on crypto trading.
- The ex-CFO falsified documents submitted to the company’s accountant.
Karma caught up with Cooper Morgenthau, the former CFO of African Gold Acquisition Corporation (AGAC). He was sentenced to three years in prison for stealing $5 million, which he squandered on meme stocks and crypto trading.
On April 27, the US Department of Justice published a press release announcing that the previous Chief Financial Officer (CFO) of AGAC had stolen over $5 million from three Special Purpose Acquisition Companies (SPAC).
In the press release titled ‘Former Chief Financial Officer Sentenced To 36 Months In Prison For Fraud Scheme’, the US Attorney for the Southern District of New York, Damian Williams, confirmed that Cooper Morgenthau was found guilty of committing wire fraud which earned him a 36 months prison sentence.
According to the US DOJ, Cooper had begun perpetrating his fraudulent scheme between June 2021 and August 2022, the CFO of AGAC and SMAC (Strategic Metals Acquisition Corporation). Cooper had stolen the funds to trade equities and options of cryptocurrencies and “meme stocks,” thereby losing almost all embezzled funds.
To hide his crimes, the former CFO forged bank statements that he submitted to AGAC’s auditor and accountant—which were ruled as material misstatements in the firm’s public filing with the SEC.
According to the US SEC’s (Securities and Exchange Commission) complaint, Cooper Morgenthau had raised money from Strategic Metal’s investors under the guise of using the money to launch Strategic Metals SPACs. Instead, he used the funds for his selfish reasons.
Although Cooper had deceived the investors into giving him their money, he squandered it on covering his tracks at AGAC and resumed trading meme stocks and crypto.
“A message has been sent to SPAC promoters that fraud in the SPAC markets is punishable, and greed on Wall Street will be met with serious consequences,” the United States Attorney, Damian Williams, said.
At 36, Cooper Morgenthau, the ex-CFO of AGAC, pleaded guilty to one count of wire fraud and was also ordered to forfeit and pay a restitution fee of $5.1 million.
Cooper had embezzled from AGAC and two SPAC series called Strategic Metals Acquisition Corporation I and II. The SEC’s complaint alleged that Cooper Morgenthau had violated Sections 10(b) and 13(b) (5) of the Securities Exchange Act of 1934 and many more.
The culprit agreed to the judgment restricting him from serving as a director or an officer of a publicly traded company.
What is African Gold Acquisition Corporation?
Founded in November 2020, AGAC is a blank check company that aims to obtain businesses through mergers, stock purchases, capital stock exchange, and asset acquisition.
In August 2022, the firm published a blog post announcing that it had filed a form 8-K with the SEC and, from its internal investigations, discovered that Cooper Morgenthau had made “improper withdrawals,” which led to his termination from the company.
Conclusion
Cooper Morgenthau had embezzled funds for over a year, and upon an internal investigation carried out in AGAC, his days were cut short, and he was sentenced to 36 months in prison for his fraudulent scheme.
