SEC Files Fraud Charges Against Lottery.com and Executives

The Securities and Exchange Commission (SEC) has charged Lottery.com, Inc. and several former executives with alleged financial fraud. Those charged include Lawrence Anthony DiMatteo, the former CEO, along with former executives Matthew Clemenson and Ryan Dickinson. The investigation also implicates Vadim Komissarov, CEO of Trident Acquisitions Corp, a special purpose acquisition company (SPAC).

Allegations of Financial Misconduct

The SEC’s case was filed in the U.S. District Court for the Southern District of New York. The regulator outlined serious allegations against the individuals involved. According to the complaint, Komissarov is accused of orchestrating a “revenue scam” alongside DiMatteo, Clemenson, and Dickinson. These actions allegedly breached multiple regulations, including Section 17(a) of the Securities Act of 1933 and Sections 10(b) and 14(a) of the Exchange Act of 1934.

Central to the allegations are claims involving the misuse of customer data. The SEC describes this as “useless customer data” that was manipulated through various high-value transactions. The initial fraud complaint states that Lottery.com purportedly generated $9 million by using worthless customer data, which was then recorded as revenue. This amount was allegedly funneled into overpaying for two Mexican businesses, effectively cycling the funds back to their original source.

Another component of the alleged fraud includes a fabricated sale of advertising credits valued at $30 million. Following the merger, the case claims that two additional fraudulent sales were executed, totaling over $35 million. The SEC asserts these transactions involved international companies and had no legitimate commercial value, particularly before and after Trident Acquisitions Corp completed the merger.

Consequences for Executives

The SEC has formally charged DiMatteo, Clemenson, and Dickinson with aiding and abetting violations related to Lottery.com’s financial reporting and controls. Their actions reportedly led to significant damage to the company’s value and misrepresented the financial position to investors. Additionally, they face accusations of falsifying and altering financial records for personal gain, violating Section 13(b)(5) of SEC regulations.

Clemenson and Dickinson have consented to the SEC’s proposed judgments, agreeing to permanent injunctions, civil penalties, and officer-and-director bars without admitting or denying the allegations. This agreement awaits court approval. Meanwhile, the cases against Komissarov and DiMatteo remain active, with the SEC seeking permanent injunctions, disgorgement with prejudgment interest, civil penalties, and officer-and-director bars. As of now, no trial date has been set.

The ongoing developments in this case highlight the SEC’s commitment to addressing financial misconduct and protecting investors. As the investigation unfolds, it underscores the importance of transparency and integrity in corporate governance.