Woofun AI reports that the SEC has initiated legal proceedings against Florida resident Zan Shaikh and his entity Mining Automatic. The complaint alleges the defendants raised approximately $22 million from more than 380 investors through a deceptive cryptocurrency mining scheme between June 2023 and May 2025.

The SEC asserts that only 13% of the capital was utilized for mining activities, while the remainder funded marketing, new investor acquisition, and personal expenses. Charges include violations of the Securities Act of 1933 and the Securities Exchange Act of 1934. The defendants have consented to a permanent injunction pending court approval, with disgorgement and penalties to be determined.