23 January, 2020 | AtoZ Markets – US SEC is tightening the loop around the initial exchange offers (ICOs). The commission has filed one more allegedly fraudulent ICO of unregistered digital securities. US SEC accused Opporty International and its founder Sergii "Sergey" Grybniak for conducting an unregistered ICO.
SEC: Opporty ICO Was Not SEC Compliant
Opporty launched its ICO between September and October 2018. According to the SEC, Opporty and Grybniak raised approximately $ 600,000 from nearly 200 investors by selling unregistered securities (OPP tokens) during 2017-2018. They falsely claimed that the ICO was "SEC-regulated" and "SEC-compliant," said the regulator.
A complaint alleges that Grybniak had marketed Opporty's ICO as a means of raising funds. Opporty's ICO aimed to develop "the blockchain-based ecosystem for small businesses and their customers primarily in the US." He proposed the platform where small businesses can list their services and products. Moreover, small businesses could use blockchain smart contracts to enter into agreements with customers and conclude transaction using OPP tokens. Grybniak sold the tokens using a SAFT (Simple Agreement for Future Tokens) agreement.
Opporty claimed to have thousands of "verified providers " to do business on the platform. Most of which "did not express such desire," reads the SEC's complaint. A claim of having more than 17 million businesses in its database turned out to be a simple purchase of a third-party catalogue.
The complaint also names another entity controlled by Grybniak (Clever Solution Inc.) as a defendant. The SEC calls for permanent injunctions, disgorgement plus interest, and civil penalties against Grybniak and Opporty. However, the case is ongoing in the Eastern District Court of New York.
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The SEC Is Getting Serious About ICOs in 2020
The SEC has pledged to offer more indulgent and flexible treatment to crypto projects in 2020. But it appears that some projects will remain under scrutiny.
Last week, the SEC filed a civil lawsuit against Boaz Manor, Edith Pardo and two companies alleging ICO fraud that raised $ 30 million. Earlier, the regulator was also seeking to get over $ 16 million in disgorgements and civil penalties from the ICOBox token sales and its founder. SEC also issues first IEOs warning to all crypto investors in the US market.
In addition to offering unregistered securities, A possible distinction for Opporty is that the project allegedly has lied about its achievements. Furthermore, unlike many similar ICOs, the offering did not explicitly exclude US investors from participation.
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