Krish Kumar Investment Loss Investigation
Have you suffered losses with Krish Kumar and Future Fractal Investments LLC and Arcane Resonance Fund, LLC?
Peiffer Wolf is currently investigating claims against the brokerage firms utilized by Krish Kumar which resulted in millions of dollars of losses for investors.
If you’ve invested with Krish Kumar and lost money, contact us today by filling out a Contact Form or by calling 585-310-5140 for a FREE Case Evaluation.
SEC Charges Krish Kumar for Defrauding Investors
On March 26, 2026, the U.S. Securities and Exchange Commission filed a civil complaint in the Northern District of Oklahoma against Krish Kumar, a college student from Tulsa, alleging that he orchestrated a sweeping investment fraud spanning more than a year.
According to the SEC’s complaint, Kumar raised approximately $7.8 million through two private investment funds—Future Fractal Investments LLC and Arcane Resonance Fund, LLC—by making a series of materially false and misleading representations to roughly two dozen investors. The SEC further alleges that Kumar misappropriated nearly $7 million of those funds by transferring them into personal accounts he controlled.
What Investors Were Told
Between January and March 2024, Kumar allegedly used personal connections from his upbringing in Tulsa to solicit approximately $6 million from at least 13 investors. Through a prospectus dated December 27, 2023, in-person meetings, phone calls, and video conferences, Kumar allegedly made the following representations:
- Future Fractal would exclusively trade options on two specific broad-based index ETFs designed to track the S&P 500 and Nasdaq-100 (referred to in the complaint as “Index-Based ETF A” and “Index-Based ETF B”).
- The fund employed a proprietary algorithmic options trading strategy Kumar had personally developed and back-tested.
- No single trade would exceed 5% of the fund’s assets under management (AUM).
- Maximum drawdown was capped at 25%, and if losses ever exceeded that threshold, investors would be reimbursed up to 75% of their contributed capital.
- The fund had achieved a 15.7% return in its very first week of trading—a figure Kumar used in a February 3, 2024 email sent to more than 30 existing and prospective investors.
What the SEC Says Actually Happened
The SEC alleges that every key representation was materially false. Beginning on January 30, 2024—just the second day of active trading—Kumar allegedly traded securities other than the two permitted index ETFs. According to the complaint, records show Kumar never traded Index-Based ETF A at all, with only limited activity in Index-Based ETF B.
As for the 15.7% first-week gain? The SEC says it never happened. Trading records in the Future Fractal brokerage account, to which only Kumar had access, show the fund actually incurred a loss of approximately $1,200 (0.09%) during that same week. Kumar’s February 3 gain prompted a flood of 12 additional investments totaling $4.7 million from new and existing investors. By the end of February 2024, the trading losses within the fund had ballooned to approximately $470,000.
The Asset Transfer and the Bitcoin Mining Gamble
The SEC’s complaint describes what happened next as a dramatic escalation. Between late February and early March 2024, Kumar allegedly transferred nearly $5.4 million of Future Fractal’s assets to his own personal brokerage account and an additional $250,000 to a nominee brokerage account he controlled—neither transfer was disclosed to investors.
Then, over just four trading days in mid-March 2024, specifically March 11–14, Kumar allegedly used those assets to purchase 33,009 option contracts in a single publicly traded crypto-asset technology company focused on Bitcoin mining (referred to as “Issuer A” in the SEC’s complaint). That purchase reportedly represented 80% of the total outstanding trading volume for options on Issuer A during that period. It was an all-in bet—the antithesis of the diversified, risk-managed strategy Kumar had allegedly promised investors.
The Issuer A option contracts expired essentially worthless. The SEC alleges Kumar lost approximately 98% of the Future Fractal assets he had transferred to his personal accounts over just four trading days, resulting in a reported loss of $6,207,269.
The Cover-Up: A Fabricated Brokerage Screenshot
According to the SEC, rather than come clean about the real cause of the losses, Kumar sent investors a March 14, 2024, email titled “Explanation and Evidence of Loss” that was almost entirely false. In it, he claimed the losses resulted from trades in Index-Based ETF B and the failure of a stop-loss order to execute. As supposed proof, he attached what the SEC describes as a photoshopped screenshot of brokerage transactions designed to look like legitimate trades in Index-Based ETF B.
The SEC further alleges Kumar never traded Index-Based ETF B in any meaningful way, no stop-loss order was ever placed, and the screenshot was fabricated. Allegedly, Kumar also separately texted a Future Fractal investor that the losses were due to Index-Based ETF A trades which is also false, per the complaint. At no point did Kumar disclose that the vast majority of investor money had been moved to personal accounts before the catastrophic trades occurred.
Starting Over After Collapse
Beginning in May 2024—just weeks after Future Fractal’s implosion—Kumar allegedly began soliciting investors for a new fund: Arcane Resonance Fund, LLC, a Michigan LLC with its principal place of business in Bloomfield Hills, Michigan. Arcane purportedly focused on crypto assets, equities, and options using a “mathematical arbitrage strategy” Kumar claimed to have developed.
The SEC states that between May 2024 and February 2025, Arcane raised approximately $1.8 million from 10 investors. The SEC also notes that most were parents of Kumar’s college friends who had not invested in Future Fractal.
The SEC further alleges Kumar made the following false claims to attract Arcane investors:
- The “worst case expected return” was 1.2x the invested amount—representing a 20% gain.
- 99% of Arcane assets would be used for investment purposes; only ~1% for operational expenses.
- At least 80% of Arcane assets would be held in cash, with maximum risk of loss at 10–20% of capital.
- Kumar had run 100,000+ simulations of his algorithm, with “zero cases of principal loss.”
- His prior fund (Future Fractal) had yielded a positive return of 30–40%.
The SEC alleges Kumar described Future Fractal to at least one Arcane investor as yielding a 30–40% positive return—when in reality, after his transfers and trading losses, Future Fractal investors lost approximately 98% of their investment.
Commingling Funds and Unauthorized Payments
The SEC further alleges that Kumar commingled Arcane investor funds with Future Fractal funds in a bank account still bearing Future Fractal’s name. When a large Arcane investor contributed more than $450,000 in July and August 2024, Kumar allegedly used $300,000 of that money to pay back a Future Fractal investor who had demanded a refund after the collapse of that fund. He allegedly told the Future Fractal investor the repayment money came from meme coin trading.
It is also alleged that an additional $20,000 of Arcane investor money was used to retire a personal debt Kumar owed to an unrelated third party. The complaint notes that none of these uses were disclosed to Arcane investors or authorized under Arcane’s operating documents.
The Meme Coin Pivot and Arcane’s Collapse
It is reported that after months of reporting positive returns to Arcane investors—including a reported cumulative net gain of 33.07% as of January 20, 2025—the situation deteriorated rapidly. On January 30, 2025, Kumar told investors Arcane was down about 10%. Less than two weeks later, he reported a negative cumulative return of 22.17%, attributing it to an undisclosed “shift in strategy” into meme coins. By March 11, 2025, Kumar told Arcane investors the fund was down approximately 80%.
The SEC alleges that at least one investor, upon calling Kumar, learned for the first time that Arcane might be approximately 70% long in illiquid meme coins. When that investor demanded full disclosure of Arcane’s holdings, Kumar reportedly refused, citing confidentiality.
A Timeline of the Alleged Fraud
- January 6, 2023. Kumar, 19, creates Future Fractal Investments LLC as a freshman in college.
- December 27, 2023. Future Fractal prospectus dated this day; Kumar provides it to investors ahead of the fund’s active trading period.
- January 26 – March 6, 2024. Kumar raises approximately $6 million from at least 13 investors using personal connections in Tulsa.
- January 29 – February 2, 2024. Future Fractal’s first week of trading. The SEC alleges a net loss of ~$1,200; Kumar claims a 15.7% gain.
- February 3, 2024. Kumar emails 30+ investors touting the false 15.7% return. Twelve additional investments pour in, raising $4.7M more.
- January 30 – February 29, 2024. Kumar trades securities outside the permitted ETF strategy, losing ~$470,000 of fund assets.
- Late February – Early March 2024. Kumar transfers ~$5.4M from Future Fractal’s account to his personal brokerage account and $250,000 to a nominee account.
- March 11–14, 2024. Kumar purchases 33,009 option contracts in a Bitcoin mining company using transferred Future Fractal assets—representing 80% of market volume. He loses ~98% of the remaining assets.
- March 14, 2024. Kumar sends investors a fabricated email with a photoshopped brokerage screenshot, blaming losses on Index-Based ETF B trades and a failed stop-loss order.
- May 2024. Kumar begins soliciting investors for Arcane Resonance Fund, LLC, his second fund.
- August 2024. Arcane Resonance Fund, LLC is formally established as a Michigan LLC.
- November 4, 2024. Kumar uses $300,000 of Arcane investor funds to secretly pay back a Future Fractal investor; $20,000 used to pay a personal debt.
- January 20, 2025. Kumar’s last positive Arcane weekly report claims a cumulative gain of 33.07%.
- February 2025. Kumar reports Arcane is down 22.17%, blaming a secret shift to meme coin investing.
- March 11, 2025. Kumar tells Arcane investors the fund is down approximately 80%.
- March 26, 2026. The SEC files its civil complaint against Krish Kumar in the U.S. District Court for the Northern District of Oklahoma (Case No. 26-cv-00184-JFJ).
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