Ben Wiener Lawsuit in Sioux Falls: Benaiah Collapse and FBI Raids

Ben Wiener, the founder of Sioux Falls hedge fund Benaiah Holdings, is the defendant in a lawsuit in Sioux Falls federal court accusing him of running a cryptocurrency Ponzi scheme that lost investors more than $10 million. The flagship case, Kinnetz v. Benaiah Holdings, Inc. et al., was filed in July 2025 and alleges fraud, conversion, fraudulent conveyance, and breach of fiduciary duty. A federal judge has since frozen the firm’s assets, the FBI and IRS have raided its offices, and a court-appointed receiver has described the operation as a “classic Ponzi scheme.”

Who Ben Wiener Is and How He Pitched Benaiah

Benaiah Holdings was incorporated in South Dakota in 2018. It began as an insurance company and later pivoted to wealth management focused on digital currencies. Wiener built a cluster of affiliated entities around it, including Benaiah Capital, LLC (a South Dakota advisory company formed in 2021), Benaiah Digital, LP (a Delaware hedge fund focused on digital assets), and Benaiah Digital Fixed Income, LP. Several other companies operated out of the same Sioux Falls office at 105 North Krohn Place, including Aslan Management (doing business as Benaiah Custody Solutions), ELAH Tech, and Benaiah Enterprises.¹

Publicly, Wiener presented Benaiah as a “boutique investment firm focused exclusively on digital assets, blockchain technology, and the advances in Web3.” His biography cited more than fifteen years as a business owner, academic training in economics and finance, and expertise in trading strategies and risk mitigation. He served as Treasurer of the South Dakota Blockchain Institute.²

The Kinnetz complaint tells a different story. It alleges Wiener was a former insurance salesman with no meaningful experience in cryptocurrency, investment advising, or hedge fund management, and that neither he nor any Benaiah entity held FINRA registration or any other license to manage investments or provide financial advice.¹

What the Kinnetz Lawsuit Alleges

The case is Timothy A. Kinnetz v. Benaiah Holdings, Inc. et al., Case No. 4:25-cv-04134, filed July 18, 2025, in the U.S. District Court for the District of South Dakota. Kinnetz, a Florida resident acting as trustee of the Timothy A. Kinnetz Revocable Trust, alleges the defendants stole $4 million from his trust.¹

According to the complaint, Kinnetz invested $4 million with Benaiah in December 2021: $1 million into Benaiah Digital and $3 million into a Kraken cryptocurrency exchange account managed by Benaiah Capital. The agreed strategy was to buy and hold major cryptocurrencies like Bitcoin and Ether. Kinnetz did not authorize lending, staking, options trading, or margin trading.¹

The complaint describes a scheme that unraveled in stages. In late 2022, Benaiah did what it called “tax loss harvesting,” selling off holdings to realize tax losses. On February 17, 2023, Wiener allegedly told Kinnetz the proceeds had been reinvested. They had not. To paper over the gap, Wiener allegedly set up a Koinly account in November 2023 and represented it as a real-time tracker linked to the Kraken account. The complaint alleges the Koinly dashboard actually displayed manually imported, static data designed to mask that the underlying assets had already been drained.¹

Kinnetz says he learned the truth in March 2025 when he logged into his Kraken account and found a balance of $599.30. Kraken records cited in the complaint show the account had been liquidated to near zero by March 17, 2025. The complaint calculates an all-time loss of $2,999,400.70 from the Kraken account alone.¹

Besides Wiener, the suit names Joshua Dewitt, a board member and Chief Investment Officer who also ran a separate Sioux Falls cryptocurrency startup called CoinLion, and Christopher Charles Hmielewski, a board member who handled investor relations. The four Benaiah corporate entities are also defendants. The complaint asserts common law fraud, fraudulent conveyance under South Dakota law, conversion, and breach of fiduciary duty.¹

How the Money Allegedly Moved

The complaint alleges Wiener and Hmielewski “rapidly shuffled” investor proceeds through Benaiah Capital, Benaiah Digital, and Benaiah Holdings, using inter-company transactions to pay staff, pay themselves, and keep the operation running. It also alleges Wiener loaned more than $7 million in borrowed funds to Reliz Technologies LLC, doing business as BlockFills, which then defaulted. That lending was not authorized by investors and contributed to the fund’s inability to meet redemption requests.¹

The court-appointed receiver, Lighthouse Management Group, later put figures to the broader picture. According to a December 2025 report summarizing the receiver’s findings, Benaiah and its associated entities took in $25.1 million in cash from investors, plus an undetermined amount in digital assets. Roughly $12 million was paid back to investors, about $5.7 million was transferred into Wiener’s personal bank account, and about $6.5 million remained unaccounted for. When the receiver took control, $888 was left in the accounts.³

The receiver called the operation a “classic Ponzi scheme,” saying contributions from newer investors were used to pay earlier ones. The receiver also identified numerous transfers between the interrelated entities that lacked “readily apparent business justification” and appeared designed to conceal asset values and fund movements from investors and administrators.³

Collapse, FBI Raids, and the Asset Freeze

The warning signs preceded the collapse by months. In November 2024, investor statements from Benaiah began arriving late. On February 11, 2025, third-party fund administrator NAV Consulting terminated its relationship with Benaiah Digital, cutting off investors’ access to their account portals. When Kinnetz asked about it, Wiener reportedly blamed a new administrator onboarding process.¹

On June 26, 2025, the FBI and the criminal division of the IRS raided Benaiah’s Sioux Falls office and Wiener’s personal residence. The Benaiah entities effectively collapsed in the final days of June, and Benaiah Capital was placed in delinquent status with the South Dakota Secretary of State.¹

On August 15, 2025, U.S. District Judge Camela Theeler found merit in the fraud allegations and ordered Benaiah’s assets frozen, citing evidence that Wiener had engaged in “deceptive and misleading statements” and an “imminent danger of further dissipation of assets.”⁴

The receivership was later expanded to more than a dozen business entities connected to Wiener, including Ilana Wealth, a new LLC he established in June 2025, the same month as the raids. The receiver found the entities were “intertwined and dependent on each other operationally,” with commingled assets used interchangeably. Wiener told the receiver that $6 million in digital assets remained in “cold storage” but that he could not access them because the cryptographic keys were on devices seized by federal law enforcement during the June raids.³

Other Lawsuits and Judgments

The Kinnetz case is not the only litigation. The complaint references several other pending actions, including Dynamic Alpha v. Wiener, Syverson et al. v. Wiener et al., and Taunton Ventures, LLC v. Benaiah Capital, LLC et al., with creditor claims “well in excess of $10,000,000.” Between June and September 2025, $11.1 million in civil judgments were entered against the Benaiah entities and related companies.¹³

A separate case in Hennepin County, Minnesota, brought by plaintiffs identified as the McKinzies, targets Wiener and Runway Four10, LLC, another entity he allegedly began operating as an investment firm after Benaiah’s collapse. In a February 2026 ruling in the Dynamic Alpha matter, Judge Theeler clarified that the receivership order does not prevent plaintiffs from pursuing personal judgments against Wiener, but does bar enforcement or collection against receivership assets without court approval. The same limits apply to the McKinzies and Runway Four10.⁵

Criminal Investigation and Current Status

The FBI and IRS criminal investigation into Wiener and Benaiah Holdings remains open. As of December 2025, no formal criminal charges had been publicly filed against Wiener, Hmielewski, or Dewitt.³⁴

The federal civil case is still active. In June 2026, Judge Theeler appointed attorney John R. Hinrichs to represent Wiener in connection with a contempt motion and scheduled a hearing for August 12, 2026. An evidentiary hearing was held on June 3, 2026, and the court has ruled on several additional motions, including denying a motion for reconsideration. Lighthouse Management Group continues to serve as the court-appointed receiver.⁶

1
US District Court for the District of South Dakota. Kinnetz v. Benaiah Holdings, Inc. et al., Complaint
2
South Dakota Blockchain Institute. Board of Directors
3
KBHB Radio. Fraud Investigation Into South Dakota Based Hedge Fund
4
The Dakota Scout. FBI, IRS Probing Sioux Falls Hedge Fund
5
CaseMine. Dynamic Alpha, LLC v. Wiener, Ruling on Intervention
6
PACER Monitor. Kinnetz v. Benaiah Holdings, Inc. et al.