The U.S. Securities and Trade Fee (SEC) is settling securities fraud allegations levied towards the Seattle-based firm Coinme Inc. for $4 million in penalties.
In response to an SEC announcement, the US securities regulator accuses Coinme, its subsidiary Up World and Neil Bergquist, the CEO of each entities, of violating securities legislation for promoting the digital asset UpToken (UP).
The SEC additionally accuses Bergquist and Up World of constructing false and deceptive statements concerning the demand for UpToken and the quantity raised within the preliminary coin providing (ICO).
The phrases of the settlement embrace Up World agreeing to pay a $3.52 million penalty for which Coinme is liable, Coinme agreeing to pay a separate $250,000 penalty and Bergquist agreeing to pay a penalty of $150,000.
The SEC prices relate to the ICO between October sixteenth, 2017 to December fifteenth, 2017.
In response to the SEC, Coinme, Up World and Bergquist falsely marketed that traders might see positive factors in accumulating UpToken as Coinme meant to purchase the digital asset within the secondary market following the ICO. The SEC goes on to say that each Bergquist and Up World had already taken measures to front-run potential UpToken traders.
“Bergquist and Up World took steps earlier than and all through the ICO to acquire an UpToken provide that will considerably cut back Coinme’s must buy UpToken after the ICO, and likewise knowingly or recklessly publicly inflated quantities raised within the ICO.”
The announcement additionally reveals that Coinme, Up World and Bergquist agreed to settle the fees with out admitting or denying the SEC’s accusations.
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