- Kahn is a long-term client of B. Riley, who financed his takeover of Franchise Group
- B. Riley has denied claims that US authorities are investigating its activity
- Nomura reportedly helped the bank get a $600 million loan to assist Kahn
Investment bank B. Riley is being investigated by the US Securities and Exchange Commission (SEC) in connection with one Brian Kahn, a purported co-conspirator in a US Department of Justice case, Bloomberg reported, citing insiders.
Riley denies claims, blames short sellers
B. Riley has denied claims that US authorities are investigating its activity, but assured it would cooperate fully if an investigation did become fact. According to a statement cited by Coindesk, the Bloomberg report is repeating baseless accusations from short sellers intending to damage the bank’s reputation. They have been making those publicly for months, B. Riley insists.
A leading investor in Bitcoin mining
The investment bank has been making huge investments in Bitcoin mining. In September last year, Bitcoin mining company Iris Energy signed an agreement to sell B. Riley equity of up to $100 million.
In March last year, a court overseeing Core Scientific’s Chapter 11 bankruptcy filing approved a $70 million loan in favor of the ailing miner from B. Riley.
About Brian Kahn
The Brian Kahn in question has not been identified. According to Bloomberg’s sources, this person is the CEO of Franchise Group Inc., a retail company based in Delaware, Ohio.
In November last year, a cofounder of the hedge fund Prophecy Asset Management pled guilty to securities fraud in the amount of $294 million against customers of the fund. He testified that he had had accomplices, one of whom was the CEO of a multibillion-dollar retail franchise. It is assumed he meant Kahn.
Nomura’s involvement
According to Bloomberg, Kahn has been a long-term client of B. Riley. The bank financed his efforts to take over Franchise Group. Nomura, a leading Japanese financial conglomerate, reportedly helped the bank get a $600 million loan to assist Kahn in his acquisition.
Among the crypto-related firms Nomura backs are Ledger and Komainu. Bloomberg wrote that Nomura wasn’t the focus of the investigation, which was still in its initial stage.
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