SEC sues former Lottery.com execs over fake revenue scheme

Summary

The US Securities and Exchange Commission has filed a civil enforcement complaint against Lottery.com (rebranded to SEGG Media Corporation) and several former executives, alleging a series of fraudulent revenue schemes tied to the company’s SPAC merger.

The SEC says ex-CEO Anthony DiMatteo, former CRO Matthew Clemenson and former CFO Ryan Dickinson, together with SPAC CEO Vadim Komissarov, executed transactions that booked millions as revenue despite having little or no economic substance. The alleged scams include a purported $9m payment for valueless data and a bogus $30m sale of ad credits, with further phoney sales after the merger totalling around $35m.

Key Points

The SEC alleges Lottery.com and named executives ran a fraudulent scheme around the SPAC merger, booking sham revenue.
Alleged transactions include a $9m payment for valueless customer data and a $30m fake ad-credit sale; later phoney sales pushed the total to about $35m.
Lottery.com rebranded to SEGG Media Corporation; its market cap collapsed from roughly $400m to under $10m and the stock trades nearly 99.92% below its peak.
The board discovered the alleged fraud by mid-2022, leading to the firing/resignation of the executives and almost the entire board stepping down.
The SEC seeks remedies including officer/director bans for Clemenson and Dickinson, disgorgement, prejudgment interest and potential civil penalties subject to court determination.
The alleged inflated revenues reportedly misled investors and caused substantial losses for shareholders who relied on the company’s financial statements.

Context and relevance

This case sits at the intersection of SPAC scrutiny, corporate governance failures and regulatory enforcement. Lottery.com emerged during the 2021 SPAC boom and is now a prominent example of the risks investors faced with rapid public listings and thin due diligence.

For the iGaming and broader tech investment communities, the suit underscores heightened regulator attention to accounting practices and sham transactions around mergers. It also highlights the consequences for executives and boards when financials are found to be misleading.

Why should I read this?

Because it’s a proper mess and a textbook warning for anyone involved in SPACs, investor relations or fintech/iGaming investments. The SEC says millions of dollars of “revenue” never existed, execs resigned, the share price imploded and now regulators are coming after them. Read this if you want the short, sharp version of what went wrong and why it matters to investors and boards.