By In the first major crackdown on Crypto companies, The US-based Securities and Exchange Commission has filed a suit in California Federal Court against a crypto company based in Los Angeles ICOBox. It was reportedly reported that this company sold $14.6 million worth of its own unregistered bitcoin tokens as well as some $650 million of unregistered tokens for clients. The allegations have not been found true as of yet.
SEC highlighted that the company the company in question ICOBox, allegedly acted as a startup incubator for crypto-asset companies. SEC went on to quote further that ICOBox sold unregistered securities to thousands of investors, both on its own behalf and on behalf of other companies
The firm all this while maintained that it was exempted from registration requirements.
Statement from SEC
“By actively soliciting and attracting investors to ICOBox’s clients’ securities offerings in exchange for transaction-based compensation … defendants engaged in unregistered broker activities that violated the federal securities laws,” the SEC said.
“They will continue to flout the registration requirements absent judicial intervention,” it added.
The SEC says that ICOBox initially told investors in its own tokens that they could exchange those tokens for digital assets of the companies that ICOBox would incubate, but that it eventually halted the exchange policy and the ICOBox direct tokens have lost 95% of their value, which is now about $2.41, since they were issued in September 2017.
Details about the ICOBox Suit
The suit was filed in Los Angeles against ICOBox and principal Nikolay Evdokimov over claims the company acted as an unregistered broker-dealer and made unregistered offers and sales of securities.
Previously, the SEC had been after another ICO which has to do with the 2017 fundraiser that was conducted for Kin, which is the native token to the Kik application. This conflict eventually led to a lawsuit.
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