SEC v. Munson Accuses Adit Ventures of Multi-Year Scheme Defrauding Over 1,000 Investors
SEC Alleges $123 Million to $563 Million Scheme Involving False Pre-IPO Share Claims
The Securities and Exchange Commission alleges that Eric L. Munson and his affiliated entities—Adit Ventures Management, LLC, and the General Partners Adit Ventures I, II, and III—orchestrated a multi-year scheme to defraud investors through misrepresentations, misappropriation of funds, and violations of fiduciary duties. From April 2019 to December 2024, Defendants solicited over $123 million to $563 million from more than 1,000 investors across 60+ private funds, falsely promising access to pre-IPO shares of high-profile companies like Klarna, Flexport, and SpaceX (Compl. ¶18, ¶24). The complaint states, "Munson solicited investors by offering access to shares of stock of certain private, pre-IPO companies" (Compl. ¶1). As of March 31, 2026, Adit Ventures Management filed Form ADV reporting $465.9 million in regulatory assets under management (Compl. ¶18).
False Pre-IPO Ownership Claims Allegedly Secured $15 Million Investment
The SEC alleges that Eric L. Munson and his affiliated entities falsely claimed ownership of pre-IPO shares in high-profile companies, including Klarna Holding AB, to secure a $15,000,000 investment from a firm investing on behalf of retail and institutional investors (Compl. ¶2). In September 2020, the investor emailed Munson about access to Klarna stock; the complaint alleges Munson claimed he could "source additional $20mm" (Compl. ¶34). On October 9, 2020, Investor A sought a $10 million Klarna allocation, and Munson confirmed his ability to execute the transaction (Compl. ¶34). In October 2020, Investor A wired $15 million to Adit Ventures III based on false representations (Compl. ¶40).
However, by October 23, 2020, Munson knew his planned source for Klarna shares was unavailable but did not disclose this to the investor (Compl. ¶37). Instead, Munson instructed a vice president to draft a redacted Share Transfer Agreement falsely showing that Fika Holdings SPV III, LP, a Defendant-controlled special purpose vehicle, owned 32,000 Klarna shares at $475 per share (Compl. ¶38).
The filing further alleges that a side letter provided to the investor falsely stated that Fika Holdings SPV III owned the Klarna shares at the time of the investment (Compl. ¶40). The SEC contends that the Defendants used the funds for unauthorized purposes, including a $4,000,000 loan from Fika Holdings SPV III to Adit Ventures III in December 2020, which was then loaned to Equitas Holdings SPV, LP. Investor A had also invested $4.4 million in Equitas Holdings SPV LP (Compl. ¶49). The complaint alleges that the investor would not have invested if it had known Fika Holdings SPV III did not own the Klarna shares (Compl. ¶41). The complaint states, "Defendants used capital received from investors for their own purposes and for other Funds’ benefit" (Compl. ¶3).
Munson Allegedly Misled Investor with False Promise of $5 Million Personal Investment
The complaint also alleges that Munson falsely promised to invest $5,000,000 of his own money alongside Investor B, a trustee-administered retirement plan, to induce a $5,000,000 investment in Adit Growth Equity II ("AGE II"), a client fund. The total fund size promised for AGE II was $10,000,000 (Investor B’s $5,000,000 plus Munson’s $5,000,000) (Compl. ¶51-52). According to the complaint, in August 2021, Adit Ventures Management pitched Investor B on AGE II, falsely promising that Munson would invest $5,000,000 alongside Investor B’s contribution. The complaint alleges that Munson knew Investor B’s funds were not available for AGE II’s investments due to unauthorized loans (Compl. ¶57).
On September 30, 2021, Investor B executed subscription documents for AGE II, and on October 1, 2021, wired $5,000,000 to the fund. The complaint alleges that Munson immediately used the funds to purchase 294,117 shares of Flexport, Inc. for Adit Ventures III at a cost of $4,999,989, rather than investing the money in AGE II as promised (Compl. ¶53). At the time of Investor B’s wire, Adit Ventures III’s bank account held a balance of only $4,283 (Compl. ¶53). The complaint further alleges that as of September 2025, Munson had only invested approximately $2.5 million of the promised $5,000,000 in AGE II (Compl. ¶54).
In November 2021, Adit Ventures III borrowed an additional $5,000,000 from AGE II via two loans ($4,000,000 and $1,000,000) (Compl. ¶62). The complaint alleges that in or around November 2021, Adit Ventures III sold the Flexport shares for approximately $6.8 million, netting a profit of approximately $1.8 million, which was not shared with AGE II (Compl. ¶63).
The SEC contends that the Defendants engaged in a pattern of misconduct, including the misappropriation of investor capital and the concealment of conflicts of interest. The complaint alleges violations of the Securities Act § 17(a), the Exchange Act § 10(b) and Rule 10b-5, and the Advisers Act § 206(1) and (2) against all Defendants (Compl. ¶¶123-128). Additionally, the SEC alleges violations of Advisers Act § 206(3) against the General Partners Adit Ventures I, II, and III (Compl. ¶¶132-135), and violations of Advisers Act § 206(4) and Rule 206(4)-8 against all Defendants (Compl. ¶¶136-141). The complaint states, "Defendants pocketing the difference... deceptively inflating the reported 'Original Purchase Price'" (Compl. ¶5).
Investor B’s $2 Million Investment in Evexia Holdings SPV LP Allegedly Subject to Unauthorized Fees
The complaint further alleges that in March 2021, Investor B invested $2,000,000 in Evexia Holdings SPV LP, a client fund managed by the Defendants. The complaint alleges that the Defendants charged $50,000 in Acquisition Fees to Evexia Holdings SPV LP in the same month, despite agreements prohibiting such fees (Compl. ¶116). The complaint states that Investor B was charged an Investor Price/Original Purchase Price of $38 per share for Noom Inc. stock, though the true cost basis and any markups were not disclosed (Compl. ¶110).
Unauthorized Loans and Self-Dealing Allegedly Diverted Millions from Client Funds
The complaint alleges that the Defendants systematically misappropriated investor capital through unauthorized loans, often documented via "Intercompany Demand Notes" signed by Munson on both sides (Compl. ¶73). The SEC contends that these loans were used to finance the Defendants’ operations, purchase pre-IPO shares for the Defendants’ profit, or cover operating costs, all without disclosure or authorization from investors. The complaint states that the Defendants financed their business operations through unauthorized loans from client Funds (Compl. ¶71).
The complaint alleges that the Defendants engaged in numerous Fund-to-General Partner loans, which were unauthorized by fund agreements and often unsecured. For example, in July 2021, Adit Ventures I borrowed approximately $2.2 million from Astra Holdings SPV III, LP (Compl. ¶74). In 2021, Adit Ventures I also borrowed over $10.2 million from Ethos Holdings SPV LP, of which only $400,000 was repaid in December 2023 (Compl. ¶74). The complaint alleges that these loans were not for the stated purposes of the funds and were instead used to benefit the Defendants. The terms of these loans favored the Defendants to the detriment of client Funds, with interest rates as high as 17% annually on third-party loans to General Partners in 2023 (Compl. ¶75-76).
The complaint also alleges that the Defendants engaged in Fund-to-Fund loans totaling $1.1 million during the relevant period (Compl. ¶72). For instance, in December 2020, Fika Holdings SPV III loaned $4,000,000 to Adit Ventures III, which was then used to finance the Defendants’ operations (Compl. ¶74). On June 30, 2021, Ethos Holdings SPV, LP loaned $1.2 million to Astra Holdings SPV, LP for the purchase of SpaceX shares (Compl. ¶72). The SEC contends that these loans were not disclosed to investors and were not authorized by the fund agreements. The complaint alleges that the loans conflicted with investor disclosures and fund agreements, which often limited investments to a maximum of 10% of a fund’s capital in any single pre-IPO company (Compl. ¶24, ¶77).
The complaint further alleges that the terms of these loans were risky and unsecured, with approximately one-third of the loans having interest payments delayed by at least one year (Compl. ¶76). The complaint states, "Loans included Fund-to-General Partner and Fund-to-Fund loans, sometimes used to buy pre-IPO shares for Defendants’ profit" (Compl. ¶72).
Pre-IPO Share Markups Allegedly Concealed Unauthorized Profits
The complaint alleges that the Defendants engaged in a pattern of self-dealing by purchasing pre-IPO shares at low prices, selling them to client funds at inflated prices, and pocketing the difference while concealing the markups. The SEC contends that the Defendants misrepresented the original purchase price of these shares to investors, falsely inflating the reported cost to conceal unauthorized profits. The complaint states, "Defendants pocketing the difference... deceptively inflating the reported 'Original Purchase Price'" (Compl. ¶5).
For example, the complaint alleges that in late April 2020, Adit Ventures purchased 40 shares of Esme Learning Solutions LLC stock at $25,000 per share and sold the same shares to Nephos Holdings SPV on the same day for $40,000 per share (Compl. ¶109). The complaint alleges that Investor B’s documents falsely listed $40,000 per share as the original purchase price, concealing the $15,000 per share markup. Investor B had invested $1,000,000 in Nephos Holdings SPV in late April 2020 (Compl. ¶109).
The complaint also alleges that the Defendants profited from markups on shares of Animoca Brands Corporation Limited. On September 23, 2020, Adit Ventures I purchased 2,000,000 Animoca shares at less than $0.08 per share and sold 1,000,000 of those shares to AGE II for $0.10 per share, netting a profit of approximately $20,000 (Compl. ¶110). On July 6, 2021, Adit Ventures I purchased Animoca shares at approximately $0.86 per share and sold 80,000 shares to Metamorphose Holdings SPV LP for $1.25 per share, netting a profit of approximately $31,000 (Compl. ¶110). The complaint alleges that these markups were not disclosed to investors and were concealed through false reporting of the original purchase price.
The complaint further alleges that in July 2021, Astra Holdings SPV, LP acquired 13,100 SpaceX shares at $420 per share, and Adit Ventures I sold the same shares to Astra Holdings SPV III, LP at $498 per share, netting a profit of $78 per share or a total of $1,020,000 (Compl. ¶110). The complaint states that these transactions were part of over 150 instances where General Partners sold pre-IPO shares to client Funds without disclosure or consent (Compl. ¶111).
The complaint alleges that the Defendants charged unauthorized fees despite agreements prohibiting such fees. For example, the Adit Growth Equity III Agreement prohibited fees beyond carried interest, management fees, and expenses, yet the Defendants allegedly collected over $600,000 in Acquisition Fees via Vista Holdings SPV LP (Compl. ¶116). Similarly, Investor A’s side letter prohibited Acquisition Fees, but the Defendants allegedly collected over $400,000 in fees from Investor A’s $4.4 million investment in Equitas Holdings SPV LP (Compl. ¶117). The complaint alleges that these fees were material to investors, who expected disclosure of all fees and payments (Compl. ¶113).
Adit Ventures Management Allegedly Avoided SEC Oversight for Years
The complaint alleges that Adit Ventures Management operated as an exempt reporting adviser from April 2016 through March 2024, falsely claiming a venture capital exemption under the Advisers Act § 203(l) and Rule 203(l)-1 to avoid SEC registration and examinations (Compl. ¶148, ¶171). The SEC contends that Adit Ventures Management did not meet the criteria for the venture capital exemption because it exceeded the 20% non-qualifying investment threshold and engaged in prohibited activities, such as borrowing and leveraging fund assets (Compl. ¶171).
The complaint alleges that in March 2023, Adit Ventures Management filed a Form ADV with the SEC, falsely claiming the venture capital exemption (Compl. ¶148). It was not until March 2024 that Adit Ventures Management registered as an investment adviser with the SEC (Compl. ¶149). By that time, the complaint alleges that Adit Ventures Management had managed between $123,000,000 and $563,000,000 in regulatory assets across more than 60 funds with over 1,000 investors during the relevant period (Compl. ¶18, ¶24). As of March 31, 2026, Adit Ventures Management reported $465.9 million in regulatory assets under management (Compl. ¶18).
The complaint alleges that Munson, as the majority owner with a 75% ownership stake in Adit Ventures Management and a 70% ownership stake in each General Partner, was a control person and directly participated in the alleged violations of securities laws (Compl. ¶17, ¶175). The SEC alleges that Adit Ventures Management violated Advisers Act § 203(a) by operating as an unregistered investment adviser (Compl. ¶¶142-147). Additionally, the SEC alleges that Adit Ventures Management and Munson aided and abetted violations of Advisers Act § 206(3) by the General Partners (Compl. ¶¶180-184).
The complaint states, "Munson improperly pledged multiple Funds’ assets as collateral by transferring millions of shares owned by client Funds" (Compl. ¶7). In November 2023, Munson contacted a third-party Lending Firm about arranging a line of credit for the General Partners. On November 20, 2023, Munson emailed the Lending Firm claiming that fund agreements allowed pledging assets, and on December 6, 2023, he confirmed that fund agreements allowed leverage (Compl. ¶7). By December 2023, Munson had entered into custodian agreements to secure a $10,000,000 line of credit for two Defendant General Partners, using client fund shares as collateral (Compl. ¶32).
Breach of Fiduciary Duty and Control Person Liability
The complaint alleges that the Defendants breached their fiduciary duties to investors by failing to exercise the utmost good faith in their dealings. The complaint states, "The duty of loyalty requires Defendants to exercise the utmost good faith in dealing with their clients" (Compl. ¶10). The SEC contends that the Defendants breached this duty by misappropriating fund capital, inflating share prices, and charging unauthorized fees (Compl. ¶12). The complaint further alleges that Munson, as a control person under Exchange Act Section 20(a), is liable for the violations of the Exchange Act § 10(b) and Rule 10b-5 committed by the General Partners (Compl. ¶175).
The allegations in the complaint are unproven, and no Defendant has yet responded to the SEC’s charges.
The allegations described here are taken from the filing and remain unproven; no responsive pleading is reflected in the source document.
David Brunk is a civil litigation attorney. He can be reached at david@newmanbrunk.com.
From the Complaint Public Court Record
1 ZACHARY A. AVALLONE DANIEL J. BALL Attorneys for Plaintiff SECURITIES AND EXCHANGE COMMISSION 100 F Street, N.E. Washington, D.C. 20549 (202) 551-4479 (Avallone) (202) 551-5987 (Ball) AvalloneZ@sec.gov BallDan@sec.gov UNITE D STATES DISTRICT COURT SOUTHERN DISTRICT OF NEW YORK SECURITIES AND EXCHANGE COMMISSION, Plaintiff, v. ERIC L. MUNSON; ADIT VENTURES MANAGEMENT, LLC; ADIT VENTURES, LLC; ADIT VENTURES II, LLC; and ADIT VENTURES III, LLC, Defendants. Civil Action No. 1:26-cv-06800 JURY TRIAL DEMANDED COMPLAINT Plaintiff Securities and Exchange Commission (“SEC” or “Commission”), for its Complaint against Defendants Eric L. Munson (“Munson”), Adit Ventures Management, LLC (“Adit Ventures Management”), and certain General Partners— Adit Ventures, LLC (“Adit Ventures I”), Adit Ventures II, LLC (“Adit Ventures II”), and Adit Ventures III, LLC (“Adit Ventures III”)—alleges as follows:
2 SUMMARY 1. From at least April 2019 through December 2024 (“Relevant Period”), investment adviser Eric Munson acting through and on behalf of Adit Ventures Management and the Defendant General Partners, offered and sold interests in private funds (“Funds”). Munson solicited investors by offering access to shares of stock of certain private, pre-IPO companies—investments that, if the company were sold or went public, could trigger a liquidity event resulting in a significant payout to investors. 2. Misrepresentations to Induce Investments. In certain instances, Defendants resorted to false claims and promises to persuade some investors to contribute capital to the Funds. In one case, Munson secured more than $15 million from an investor by falsely claiming that an investment vehicle he controlled already owned shares of a certain pre-IPO company stock, when at that point the vehicle did not hold any shares. And in another example, Munson persuaded an investor to contribute $5 million into a Fund by falsely claiming that he would invest $5 mill
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