Cryptocurrency platform penalized $45 million for illicit activities

STATEN ISLAND, N.Y. — A US government agency announced Thursday one of its latest initiatives for cryptocurrency platforms.

The Office of Attorney General Letitia James has announced a lawsuit against Nexo Inc. and Nexo Capital Inc. Nexo Inc. and Nexo Capital Inc. have filed lawsuits alleging that they engaged in unregistered offerings and sales of securities and commodities and lied to investors about their registration status.

“Cryptocurrency companies are unreliable and shady, but they are not exempt from accountability,” James said. “Nexo ignored repeated warnings by my office to register. We are coming to an end.”

The agreement covers the sale of Nexo’s unregistered offers and securities in the form of interest-bearing cryptocurrency accounts called Earn Interest Products (EIPs). A Nexo spokesperson did not respond to a request for comment by the time of publication.

California, Indiana, Kentucky, Maryland, Oklahoma, South Carolina, Vermont, Washington and Wisconsin have joined James in the $22.5 million deal, according to James’ office. You can also purchase goods through a cryptocurrency trading platform called Nexo Exchange.

The U.S. Securities and Exchange Commission (SEC) also announced another settlement in which Nexo agreed to pay an additional $22.5 million and stop offering and selling variable rate EIP accounts in the United States.

In addition to monetary damages, the provisions of the agreement with Nexo include a five-year ban on Nexo from offering or selling securities in New York, and all remaining U.S. It includes Nexo’s requirement to withdraw the assets from the Nexo platform. , 2023.

SEC Chairman Gary Gensler said the settlement means that Nexo’s unregistered lending products will no longer be available to US citizens.

“We have charged Nexo with circumventing critical disclosure requirements designed to protect investors and failing to register a retail cryptocurrency lending product prior to making it available to the public,” Gensler said. “Compliance with proven public policy is not an option. We will continue to follow the facts and the law and hold them accountable when cryptocurrency companies do not comply.”

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