Texas man says SEC and fund could make him pay twice

Filed July 1, a Texas man says the SEC and a private company are chasing the same frozen assets - and he could pay twice. 

A Texas man and his company went to federal court in Houston on July 1 with a rare kind of problem. Two claimants are after the same frozen assets: the Securities and Exchange Commission on one side, and a Wyoming company, Bliss Creek Fund 1, LLC, on the other. He says the pool cannot cover both, and that unless a judge steps in, he could pay for the same alleged losses twice. 

The setup, according to the filing, took shape fast. In August 2024, a federal court in Georgia froze the assets of the man and his company in an SEC enforcement action tied to what the complaint calls an "alleged securities scheme." The next day, both entered consent judgments requiring "disgorgement of any ill-gotten gains," interest, and a civil penalty, with the dollar figures left for the court to set. 

Bliss Creek came at them from a different direction. It sued in Wyoming state court, bringing claims for "fraud, negligence, breach of contract, and breach of the implied duty of good faith and fair dealing," according to the complaint. When the man and his company did not answer, the court entered a default judgment on April 4, 2025 for $141,063,243.99 - about $47 million in principal and compensatory damages and roughly $94 million in punitive damages, plus 7% interest. 

Now Bliss Creek wants to collect. On June 5, 2026, it asked a Texas court for a writ of execution to seize and sell his non-exempt property across the state - the very property the federal freeze says he cannot move. Follow the freeze and he cannot pay the judgment. Pay the judgment and he breaks the freeze. 

The money is where the two claims meet. Bliss Creek bought about $16 million in Tether from the company between roughly March 2023 and June 2024, according to the filing. That sum sits inside the SEC's own count of funds raised, a pool the agency puts at about $61.6 million. So the SEC is trying to recover Bliss Creek's loss as part of the wider "investor" pool while Bliss Creek chases the same dollars alone. His answer is interpleader - a tool that lets someone facing competing claims to one pot of money ask a court to divide it - plus a request that any payment to one side count against the other. 

He adds one caveat. He disputes that Bliss Creek was an "investor," saying in a footnote that the company bought in under purchase-and-sale and technology-services agreements, not the notes used with a separate entity. 

For compliance officers and fund principals, the lesson is plain. A regulatory freeze and a private judgment can point at the same assets at once, and a shrinking frozen pool can become a race. It also shows how crypto-era fundraising, once regulators notice, can spread into parallel fights across several states. 

None of the underlying allegations against the man or his company - from the SEC or Bliss Creek - has been tested at trial. The Georgia asset freeze and consent judgments were entered by agreement, with the disgorgement amounts still to be set. The Wyoming judgment came by default and is being challenged, and the man is appealing in Texas while seeking relief in Wyoming. His interpleader complaint, filed July 1, 2026, asks the Texas court to sort out the competing claims, and no court has ruled on it.