US financial regulators begin to prosecute hedge funds and cryptocurrency brokers.
The US Securities and Exchange Commission has now begun to deal with large companies in the crypto industry. On Tuesday, the SEC fined hedge fund Crypto Asset Management, invested in virtual currency and raised $ 3.6 million from 44 investors. The commission was outraged that the head of the organization positioned the company as the first regulated crypto fund. The manager and the company were ordered to pay a fine of $ 200 thousand.
In another case, the regulator prosecuted TokenLot, a token trading company, acting as an intermediary and broker. According to the SEC, many digital assets are securities, therefore, for transactions with them, the organizers had to obtain the appropriate permits. The two founders were ordered to pay a fine of $ 560 thousand, close the site and not engage in brokerage activities for at least three years. Since July 2017, TokenLot has accepted more than 6,000 thousand orders from investors.
The financial industry regulator (Finra) on Tuesday filed a complaint against Timothy Tilton Ayre and his company Rocky Mountain Ayre, which deals with illegal distribution of HempCoin and securities fraud. Digital assets were equivalent to 0.1 shares of a publicly traded company. SEC scrutiny revealed Rocky Mountain Ayre was trying to raise government funds by offering over-the-counter (hemp)-backed securities, Finra said..
At the end of 2017, investors poured over $ 81 million by buying unregistered HempCoin and shares in the company. The decision on the charges has not yet been made, as an individual or a company can still appeal the decision of the commission. The punishment can be a fine, a ban or suspension of activities, the seizure of the Central Bank, income.
While some companies are trying to circumvent the regulation with cryptocurrencies, one of the largest financial conglomerates Citigroup is developing a regulated instrument to help institutional investors store bitcoins..
Text: Ivan Malichenko, photo: AP Photo / Dake Kang
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