In a recent case of securities fraud, authorities have discovered that the producer of the children’s television show Sesame Street used a cryptocurrency called Dogecoin to inflate market prices and mislead investors. Steven D. Chan, who produced and wrote for Sesame Street, was allegedly running a scam known as a “pump-and-dump” scheme, in which he spuriously inflated Dogecoin’s price, causing at least a 25% spike, while also making contrary misrepresentations about the character Baby Hoddle and her “semi-precious Dogecoin gemstones” in an online chat room with an undercover federal agent. Chan was arrested on Thursday and pleaded guilty to securities-fraud charges on Friday. The U.S. Securities and Exchange Commission estimates that Chan’s scheme caused more than $1 million in losses. The department charges Chan with having misappropriated future royalties due to Baby Hoddle for personal expenses and transferred Baby Hoddle’s name and image to a private messaging service for sale. The prosecutors and regulators claim that he then created a fraudulent LLC that misrepresented the purchase of rights to Baby Hoddle to give the false impression that Dogecoin had valuable assets. Authorities have cautioned against rushing into the cryptocurrency market, stressing that most coins have fundamentally worthless.
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