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SEC brings charges against an ICO listing website



The Securities and Exchange Commission reveals settled charges against the operator of Coinschedule.com, a website that profiled offerings of digital asset securities.

The US watchdog alleges that UK-based Blotics Ltd violated the anti-touting provisions of the federal securities law. The company failed to disclose the compensation it received from the digital asset securities  issuers it profiled.

The SEC stated that Coinschedule.com could be accessed in the United States from 2016 to August 2019. During that time US visitors comprised a significant portion of its web traffic.

The regulator said:

Visitors to Coinschedule.com were presented with details about each profiled digital token offering in so-called “listing” profiles, which also included links to the token issuers’ own websites and a “trust score” that Coinschedule claimed reflected its evaluation of the “credibility” and “operational risk” for each digital token offering based on a “proprietary algorithm.”  In reality, the token issuers paid Coinschedule to profile their token offerings on Coinschedule.com, a fact that Coinschedule failed to disclose to visitors.

SEC fraud

According to SEC, many ICOs listed on Coinschedule.com appear in its DAO Report published in 2017, warning that: “coins sold in ICOs may be securities and that those who offer and sell securities in the U.S. must comply with federal securities laws.” SEC revealed that Blotics has agreed to cease and desist from future violations and to pay $43,000 in disgorgement and a fine of $154,434.

Kristina Littman, Chief of the SEC Enforcement Division’s Cyber Unit, said:

Kristina Littman, SEC
Kristina Littman
Source: LinkedIn

As the SEC’s order finds, Coinschedule presented potential investors with seemingly independent profiles about token offerings when in fact they were bought and paid for by token issuers. The securities law prohibiting touting securities for compensation without appropriate disclosures to investors is clear and longstanding.

Last month, SEC revealed that it has settled its charges against CEO John Wise and his company Loci Inc. following accusations that the entity had made materially misleading and false statements regarding a sale and offer of digital asset securities that were later found to be unregistered.

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SEC brings charges against an ICO listing website

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