Feed: Slashdot
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Title: SEC Sues Crypto Startup Unicoin and Its Executives For Fraud

Link: https://yro.slashdot.org/story/25/05/21/20552...

The SEC on Wednesday said it has charged cryptocurrency startup Unicoin and
three of its top executives for false and misleading statements that raised
more than $100 million from thousands of investors. "We allege that Unicoin
and its executives exploited thousands of investors with fictitious promises
that its tokens, when issued, would be backed by real-world assets including
an international portfolio of valuable real estate holdings," said Mark Cave,
Associate Director in the SEC's Division of Enforcement. "But as we allege,
the real estate assets were worth a mere fraction of what the company
claimed, and the majority of the company's sales of rights certificates were
illusory. Unicoin's most senior executives are alleged to have perpetuated
the fraud, and today's action seeks accountability for their conduct." From
the release: The SEC alleges that Unicoin broadly marketed rights
certificates to the public through extensive promotional efforts, including
advertisements in major airports, on thousands of New York City taxis, and on
television and social media. Among other things, Unicoin and its executives
are alleged to have convinced more than 5,000 investors to purchase rights
certificates through false and misleading statements that portrayed them as
investments in safe, stable, and profitable "next generation" crypto assets,
including claims that: - Unicoin tokens underlying the rights certificates
were "asset-backed" by billions of dollars of real estate and equity
interests in pre-IPO companies, when Unicoin's assets were never worth more
than a small fraction of that amount; - the company had sold more than $3
billion in rights certificates, when it raised no more than $110 million; and
- the rights certificates and Unicoin tokens were "SEC-registered" or "U.S.
registered" when they were not. According to the SEC's complaint, Unicoin and
Konanykhin also violated the federal securities laws by engaging in
unregistered offers and sales of rights certificates. Konanykhin offered and
sold over 37.9 million of his rights certificates to offer better pricing and
target investors the company had prohibited from participating in the
offering to avoid jeopardizing its exemption to registration requirements, as
alleged.

Read more of this story at Slashdot.

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