The Securities and Exchange Commission (SEC) has announced a preliminary injunction granted against Blockvest LLC for unlicensed security offer. This overturns a previous court order, claiming that the SEC failed to prove that the token was a security.
Another Day, Another Court Case
In June last year, the SEC decreed pretty much every cryptocurrency other than Bitcoin and Ethereum to be a security. Since then, it has ramped up its ICO litigation, in what, at times, seemed like some kind of personal vendetta.
Blockvest LLC and founder, Reginald Buddy Ringgold III (aka Rasool Abdul Rahim El), initially seem like any other unfortunate target. The SEC filed an emergency court order in October 2018, suspending the ICO, and halting all pre-ICO activities.
The allegation was that Blockvest were raising funds for financial products promising passive income and double-digit returns. However, in November, a court ruled that the SEC had failed to prove that the BLV token was a security.
Cue the popping of champagne corks by Reginald Bloody Whatever-he-wants-to-call-himself III.
Hold Onto Your Horses Though
There was a little bit more to this story though, as Blockvest had (falsely) claimed that the fund was ‘licensed and regulated.’ It proudly boasted approval from major financial regulators, including the SEC, whose seal it illegally appropriated.
Not content with this, Ringgold had also promoted the ICO with his own fake regulatory agency, the Blockchain Exchange Commission. The ‘BEC’ had a strangely similar seal to the SEC and shared the same address as the SEC headquarters.
Whether the BLV token is a security or not, it is hard to argue that the ICO offer was not fraudulent in several respects. Also, the securities regulator has promised the aggressive pursuit of all unaccredited securities sold on the US market. Using its seal without permission is hardly going to inspire lenience.
So, of course, the securities watchdog continued its pursuit, and as of February 14, had managed to convince the court that promotion of the BLV token was after all a security, according to the Howey test.
Back at you, Reggie.
What do you think of the regulator’s actions? Share your thoughts below!
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