Blog Posts Tagged With Cyber and Cryptocurrency

Subscribe to Cyber and Cryptocurrency RSS Feed

In re Khaled Khaled (A.P. Nov. 29, 2018, Settled)

Action against Respondent, a celebrity music producer, for alleged touting violations in connection with initial coin offerings. According to the SEC, Respondent promoted three initial coin offerings on his social media accounts without disclosing that the issuers were compensating him for the publicity.  Defendant has agreed to pay disgorgement of $50,000, prejudgment interest of $2,725.72, and a civil penalty of $100,000.

SEC Order

SEC Press Release
Continue Reading

In re Floyd Mayweather Jr. (A.P. Nov. 29, 2018, Settled)

Action against Respondent, a professional boxer, for alleged touting violations in connection with initial coin offerings.  According to the SEC, Respondent promoted three initial coin offerings on his social media accounts without disclosing that the issuers were compensating him for the publicity.  Respondent has agreed to pay disgorgement of $300,000, prejudgment interest of $14,775.67, and a civil penalty of $300,000.

SEC Order

SEC Press Release
Continue Reading

In re Paragon Coin, Inc. (A.P. Nov. 16, 2018, Settled)

Action against Respondent, a company established to implement blockchain technology in the cannabis industry, for an alleged unregistered offering. According to the SEC, Defendant publicly offered and sold digital tokens to raise capital without registering the offering or attempting to qualify for an exemption to the registration requirements.  Defendant has agreed to pay a civil penalty of $250,000.

SEC Press Release

SEC Order
Continue Reading

In re Joseph Kim (A.P. Oct. 29, 2018, Settled)

Action against Respondent, a former virtual currency trader, for an alleged investment scheme and misappropriation of his employer’s virtual currencies. According to the CFTC, Respondent misappropriated Bitcoin and Litecoin from the trading firm where he worked. The CFTC further alleges that Respondent falsely solicited investors for funds that he then lost by executing high-risk virtual currency trades. Respondent has agreed to pay restitution of $1,146,000 and post-judgment interest and to permanent trading and registration bars.
Continue Reading

SEC Issues Investigative Report on Cyber Threats (Oct. 16, 2018)

The SEC released an investigative report addressing cyber threats that companies should consider when implementing internal accounting controls.  The report stems from SEC investigations into alleged cyber fraud perpetrated against nine public companies.  According to the SEC, personnel from these companies received emails from perpetrators posing as company executives or vendors asking that large sums of money be sent to bank accounts belonging to the perpetrators.  The SEC is not pursuing enforcement actions against the
Continue Reading

SEC v. Blockvest, LLC and Reginald Buddy Ringgold, III a/k/a Rasool Abdul Rahim El (S.D. Cal. Oct. 3, 2018, Contested)

Action against Defendants, a cryptocurrency exchange and index fund and its founder and principal, for alleged misrepresentations in connection with a cryptocurrency offering.  According to the SEC, Defendants falsely claimed that their initial coin offering was licensed and regulated by the SEC and that their business would be audited by an accounting firm.

SEC Litigation Release

SEC Press Release
Continue Reading

CFTC v. Gelfman Blueprint, Inc. and Nicholas Gelfman (S.D.N.Y. Oct. 1, 2018, Consent Order)

Action against Defendants, a Bitcoin hedge fund and its CEO, for alleged operation of a Bitcoin Ponzi scheme.  According to the CFTC, Defendants promised to use investor funds in a high-frequency algorithmic trading strategy but instead used the funds to make payouts to other investors.  The CFTC also alleges that Defendants falsified performance reports and staged a computer hack to conceal trading losses and misappropriation of investor funds.  Defendant company has agreed to pay restitution
Continue Reading

CFTC v. John Doe 1 a/k/a Morgan Hunt dba Diamonds Trading Investment House and John Doe 2 aka Kim Hecroft dba First Options Trading (N.D. Tex. Sept. 28, 2018, Contested)

Action against Defendants for alleged fraudulent scheme to solicit Bitcoin.  According to the CFTC, Defendants misappropriated customer funds after making false or misleading representations or omissions about their planned investment of funds in forex contracts, binary options, and diamonds. The CFTC further alleges that Defendants forged account statements and documents and impersonated a CFTC investigator.

CFTC Press Release
Continue Reading

In re TokenLot, LLC, et al. (A.P. Sept. 11, 2018, Settled)

Action against Respondents, an unregistered broker-dealer and its two operators, for the alleged online sale and advertisement of unregistered securities in the form of digital tokens.  The SEC alleges that Respondents solicited and executed digital token orders during initial coin offerings and additionally sold digital tokens for trading on secondary markets.  According to the SEC, Respondents failed to make required registrations as a broker-dealer.  Respondents have agreed to pay, jointly and severally, disgorgement of $471,000
Continue Reading

In re Crypto Asset Management, LP and Timothy Enneking (A.P. Sept. 11, 2018, Settled)

Action against Respondents, an unregistered cryptocurrency hedge fund manager and its principal, for the alleged sale of unregistered securities.  The SEC alleges that Respondents failed to make required registrations and misrepresented their filing status to potential investors while raising money for a cryptocurrency investment fund.  Respondents have agreed to pay a $200,000 civil penalty.

 SEC Order  

SEC Press Release

 
Continue Reading

LexBlog