The New York attorney general and the U.S. Securities and Exchange Commission (SEC) have filed charges against a cryptocurrency trading platform that allegedly defrauded thousands of investors out of over a million dollars.
US Regulators Allege Coinseed Operates Illegal Crypto Trading Platform
New York Attorney General Letitia James took legal action Wednesday to shut down the cryptocurrency trading platform owned and operated by Coinseed Inc. The lawsuit, filed in New York County State Supreme Court, alleges that Coinseed runs â€œan illegally operating cryptocurrency trading platform that defrauded thousands of investors across the nation out of more than $1 million.â€
The suit names Coinseed Inc., its founder and CEO Delgerdalai Davaasambuu, and its chief financial officer Sukhbat Lkhagvadorj as defendants.
According to the announcement by the New York attorney generalâ€™s office, â€œAttorney General James sues to shut downâ€ the crypto trading platform and â€œto recoup defrauded funds for thousands of investors.â€ Noting that â€œCoinseed willfully ignored numerous securities and commodities registration laws,â€ the announcement elaborates:
The attorney general alleges â€œCoinseed and the individual defendants were unlawfully trading cryptocurrencies, like bitcoin, without being a registered broker-dealer in New York, while simultaneously failing to disclose certain fees associated with the trading of virtual currencies on their investorâ€™s behalf.â€
The lawsuit further alleges that â€œthe defendants sought to finance their fraudulent company by raising funds in an unregistered securities offering and luring in investors with false claims about their professional experiences and the role of their management team.â€ The token sale took place approximately between December 2017 and May 2018. Hundreds of investors participated, including those in the U.S.
On the same day, the SEC announced that it has filed charges against Coinseed Inc. and its CEO for registration violations in connection with the companyâ€™s offer and sale of digital asset securities. â€œThe SEC seeks permanent injunctive relief, disgorgement plus prejudgment interest, and civil penalties,â€ the regulator detailed.
What do you think about the charges against Coinseed? Let us know in the comments section below.
Disclaimer: This article is for informational purposes only. It is not a direct offer or solicitation of an offer to buy or sell, or a recommendation or endorsement of any products, services, or companies. Bitcoin.com does not provide investment, tax, legal, or accounting advice. Neither the company nor the author is responsible, directly or indirectly, for any damage or loss caused or alleged to be caused by or in connection with the use of or reliance on any content, goods or services mentioned in this article.