Kenneth Thom, who styled himself online as "K$" or "K Money," pleaded guilty Thursday in Manhattan federal court to investment adviser fraud after prosecutors say he raised nearly $800,000 from his social media followers and then spent much of it on travel, dining and luxury goods instead of investments. Thom entered his plea before U.S. District Judge Edgardo Ramos and is scheduled to be sentenced on June 25, 2026, in a case that shows just how far an influencer persona can go when retail investors skip the basic credential checks.
In a press release from the U.S. Attorney’s Office for the Southern District of New York, prosecutors said Thom, a 42-year-old resident of Westfield, N.J., "pretended online to be a successful investor and adviser when in fact he was a suspended broker and grifter." The office said he pleaded guilty to investment adviser fraud and will be sentenced on June 25, 2026. Prosecutors credited the FBI and the SEC for investigative assistance.
How investigators say the scheme worked
As outlined in the SEC’s litigation release, Thom passed securities licensing exams in 2006 but was suspended by FINRA around January 2011 after failing to pay an arbitration award and admitting that he had commingled a client’s funds. After that, investigators say, he resurfaced online with a new persona as "K$" and "K Money," ran a Facebook trading group, and sold trading courses to build an audience.
Beginning in late 2023, Thom invited members of that group into so-called "shared accounts" that he managed in exchange for a percentage of profits, according to regulators. Investigators say he raised hundreds of thousands of dollars, invested only part of the money, and then posted false performance updates to conceal losses and withdrawals. He allegedly renamed the group "AYBABTU" in January 2025 before cutting off clients altogether, as previously reported in a Hoodline story on defrauding investors of $800K.
Plea and next steps
According to the U.S. Attorney’s Office, Thom pleaded guilty to a single count of investment adviser fraud, which carries a maximum statutory sentence of five years in prison. His sentencing hearing is scheduled for June 25, 2026, before Judge Edgardo Ramos, and Assistant U.S. Attorney Alexander Li is handling the prosecution. The guilty plea closes out the criminal side of the case for now, while civil actions continue in parallel.
Civil case and investor guidance
The SEC has filed a parallel civil complaint seeking injunctions, disgorgement and civil penalties, according to the SEC. Investors who joined the shared accounts are being urged to preserve screenshots, private messages and transaction records, and to report any suspected fraud to regulators.
The SEC’s Investor.gov portal warns specifically about social media investment scams and offers basic due diligence tips. FINRA’s BrokerCheck tool can help investors verify whether a broker is currently registered and see past disciplinary history before sending a dollar to anyone promising market-beating returns.
What this means locally
Hoodline first reported the federal indictment last August, and the guilty plea now closes the criminal chapter even as civil litigation and any restitution efforts play out. For local investors, the takeaway is blunt but useful: verify credentials through official databases, keep detailed records of every investment communication and transfer, and report questionable pitches to regulators and law enforcement before a flashy online persona turns into an expensive lesson.
