SEC Charges Two Individuals With Orchestrating Fraud Scheme That Targeted Veterans
The SEC charged Christopher Kenji Dinelli and Jacob David “Kobe” Frankel with running a fraud that allegedly raised more than $8.7 million from 35 investors through Beyond Alpha Ventures LLC and Beyond Equity LLC. The complaint says the pair misrepresented fund performance, assets under management, client base and pre-IPO holdings, diverted investor funds into brokerage accounts where most were lost to options trades, and misappropriated over $1.34 million combined.
Why It Matters
The case alleges exploitation of veterans and their service-provider networks, highlighting risks in private pre-IPO and options-linked fundraising and the SEC’s focus on frauds that target specific communities. It also involves parallel criminal charges from the U.S. Attorney's Office in Manhattan, increasing potential legal consequences.
Key Facts
- Defendants: Christopher Kenji Dinelli and Jacob David 'Kobe' Frankel
- Entities involved: Beyond Alpha Ventures LLC (BAV) and Beyond Equity LLC
- Alleged proceeds raised: More than $8.7 million
- Number of investors: 35
- Alleged misappropriations: Dinelli over $1 million; Frankel over $340,000
The Securities and Exchange Commission filed a civil complaint on Sept. 30, 2026, accusing Christopher Kenji Dinelli and Jacob David “Kobe” Frankel of running a fund- and advisory-based fraud that collected over $8.7 million from 35 investors. According to the SEC, the defendants solicited investments through Beyond Alpha Ventures LLC and Beyond Equity LLC by promising an options trading strategy and access to special purpose vehicles holding pre-IPO stock in two private companies. The complaint alleges the pair repeatedly misstated material facts to induce investments, including false claims about historical returns, assets under management, client breadth, and current or past holdings.
The SEC says Dinelli, a former naval officer, targeted veterans and individuals who provide medical services to veterans, leveraging those relationships to raise money. The regulators cite a marketing document titled “Trading Fund Overview 2024,” which the complaint says touted a “153% Net Return on Investment,” despite consistent losses in the fund. The complaint further alleges that funds from investors who believed they were purchasing pre-IPO securities were routed without their knowledge into the fund’s brokerage accounts, where most of the money was lost on failed options trades.
Beyond the trading losses, the SEC alleges direct misappropriation of investor funds: Dinelli is accused of taking more than $1 million and Frankel of taking more than $340,000. The agency’s complaint, filed in the U.S. District Court for the Southern District of New York, charges both men with violating antifraud provisions of the Securities Act of 1933 and the Securities Exchange Act of 1934; Frankel is also charged with violating the Investment Advisers Act of 1940. The SEC is seeking permanent injunctions, disgorgement with prejudgment interest, and civil penalties against both defendants.
The filing coincides with criminal charges announced this week by the U.S. Attorney’s Office for the Southern District of New York that concern the same alleged conduct. The SEC’s action also includes a pointer to an Investor Alert on risks associated with pre-IPO offerings.
Keep Reading
Metaplanet directors push back against shareholder fury over a controversial executive payout plan
U.S. bond yields post biggest jump in a generation as global rout rattles investors
How the ‘AI put’ has become the only thing that matters for stocks