US SEC Charges BitConnect Promoters with Federal Securities Violations

The US Securities and Exchange Commission (SEC) has announced it has filed charges against five individuals allegedly involved with a $2 billion global crypto lending securities offering. The class action filed before the United States District Court for the Southern District of New York says that BitConnect used a network of promoters, including Trevon Brown (a.k.a. Trevon James), Craig Grant, Ryan Maasen and Michael Noble (a.k.a. Michael Crypto) “to market and sell securities in its ‘lending program’.”

According to the press release published by the US watchdog, the SEC alleges these promoters offered and sold these offerings without any authorization, as it has not been previously registered on the Commission. Also, promoters relied on creating bogus testimonial-style videos and publishing them on YouTube.

“We allege that these defendants unlawfully sold unregistered digital asset securities by actively promoting the BitConnect lending program to retail investors. We will seek to hold accountable those who illegally profit by capitalizing on the public’s interest in digital assets,” Lara Shalov Mehraban, Associate Regional Director of SEC’s New York Regional Office, said.

The individuals allegedly received commissions based on the number of customers they attracted to BitConnect, which raised over $2 billion from retail investors. In addition, the SEC accused them to violate federal securities laws, and the complaint seeks disgorgement plus interest and civil penalties.

Global Authorities Collaboration

Authorities from the Cayman Islands, Hong Kong, Singapore, Romania, Canada (Ontario) and Thailand collaborated with the US law enforcement to investigate the billionaire crypto lending securities offering.

This week, Gary Gensler, the US SEC Chairman, said his office wants to provide crypto investors similar protection when dealing with the New York Stock Exchange Stock Exchange A stock exchange, also known as a securities exchange or bourse represents is a facility where stockbrokers and traders can buy and sell securities.This includes shares of stock, bonds, exchange-traded funds (ETFs), or other financial instruments. By extension, stock exchanges can also provide facilities for the issue and redemption of such securities and instruments and capital events including the payment of income and dividendsStock exchanges have developed into a permanent fixture in the fin A stock exchange, also known as a securities exchange or bourse represents is a facility where stockbrokers and traders can buy and sell securities.This includes shares of stock, bonds, exchange-traded funds (ETFs), or other financial instruments. By extension, stock exchanges can also provide facilities for the issue and redemption of such securities and instruments and capital events including the payment of income and dividendsStock exchanges have developed into a permanent fixture in the fin Read this Term, opening the doors for Congress to participate in the cryptocurrency Regulation Regulation Like any other industry with a high net worth, the financial services industry is tightly regulated to help curb illicit behavior and manipulation. Each asset class has its own set of protocols put in place to combat their respective forms of abuse.In the foreign exchange space, regulation is assumed by authorities in multiple jurisdictions, though ultimately lacking a binding international order. Who are the Industry’s Leading Regulators?Regulators such as the UK’s Financial Conduct Authority ( Like any other industry with a high net worth, the financial services industry is tightly regulated to help curb illicit behavior and manipulation. Each asset class has its own set of protocols put in place to combat their respective forms of abuse.In the foreign exchange space, regulation is assumed by authorities in multiple jurisdictions, though ultimately lacking a binding international order. Who are the Industry’s Leading Regulators?Regulators such as the UK’s Financial Conduct Authority ( Read this Term. Gensler believes there are still many gaps to fill in that regulators should provide enough investor protection for such an environment.