SEC Penalizes Token Sale Platform ICOBox for Securities Violation

The U.S. Securities and Exchange Commission (SEC) has slammed token sale platform ICOBox for violating the federal security laws and conducting illegal securities offering.

On Wednesday, September 18, SEC in its press release said that ICOBox and its founder Nikolay Evdokimov have been sued for selling unregistered tokens to over 2000 investors in 2017.

The SEC accuses the defendants for for wrongly promoting a p[rice surge for the ICO tokens and that they could be swapped at a discount for other tokens available then on the ICOBox platform. The SEC says that the ICO tokens promoted have become virtually worthless.

The securities regulator has slammed the company and its founder saying: “By ignoring the registration requirements of the federal securities laws, ICOBox and Evdokimov exposed investors to investments, which are now virtually worthless, without providing information that is critical to making informed investment decisions.”

Besides, the SEC has also charged ICOBox for acting as unregistered brokers and operating ICO raising over $650 million from hundreds of clients. Moreover, the SEC has also penalised ICOBox by seeking disgorgement, injunctive relief, civil money penalties and prejudgment interest.

The SEC wrote: “Defendants claimed that ICOBox would be successful — and the ICOS tokens valuable — due to the efforts of ICOBox’s management team, who would curate potential digital asset projects and attract ‘100+’ clients per month. As of the date of ICOBox’s offering, ICOBox had yet to support a single token sale to completion.”

In another statement, SEC Los Angeles Regional Office director Michele Wein Layne said, “by ignoring the registration requirements of the federal securities laws, ICOBox and Evdokimov exposed investors to investments, which are now virtually worthless, without providing information that is critical to making informed investment decisions.”

The SEC has been cracking down on ICO platforms over the last two years and minutely observing all the activities in the ICO space.

Earlier this month, decentralized computing network Blockstack PBC said that it has raised $23 million in the first ever ICO approved by the U.S. SEC. The company said: “For the first time, retail investors in the United States were able to participate in a token offering qualified by the SEC. More than 4,500 individuals and entities participated in the 2019 token offerings”.