TRON

BitTorrent

Crypto entrepreneur Justin Sun and three of his companies, Tron Foundation Limited, BitTorrent Foundation Ltd., and Rainberry Inc., have been charged by the Securities and Exchange Commission (SEC) for the unregistered offer and sale of crypto asset securities Tron (TRX) and BitTorrent (BTT).In an official press release published on March 22, the SEC <a href="https://www.sec.gov/news/press-release/2023-59" rel="noopener noreferrer nofollow">alleges</a> that Sun and his companies offered and sold <a href="https://finbold.com/cryptocurrency/tron/" rel="noopener noreferrer nofollow">TRX</a> and <a href="https://finbold.com/cryptocurrency/bittorrent/" rel="noopener noreferrer nofollow">BTT</a> as investments through multiple unregistered “bounty programs” that directed interested parties to promote the tokens on social media and recruit others to Tron-affiliated Telegram and Discord channels.Additionally, Sun and his companies are accused of offering and selling BTT in unregistered monthly airdrops to investors who purchased and held TRX in Tron wallets or on participating <a href="https://finbold.com/guide/best-cryptocurrency-exchanges/" rel="noopener noreferrer nofollow">cryptocurrency trading platforms</a>.<h2 id="header-0">Eight celebrities charged</h2>Sun is also charged with fraudulently manipulating the secondary market for TRX through extensive wash trading and orchestrating a scheme to pay celebrities to tout TRX and BTT without disclosing their compensation.Eight celebrities, including Lindsay Lohan, Jake Paul, DeAndre Cortez Way (Soulja Boy), Austin Mahone, Michele Mason (Kendra Lust), Miles Parks McCollum (Lil Yachty), Shaffer Smith (Ne-Yo), and Aliaune Thiam (Akon), were also charged for illegally promoting TRX and/or BTT without disclosing that they were compensated for doing so.Furthermore, the SEC’s investigation alleges that Sun directed his employees to engage in more than 600,000 wash trades of TRX between two crypto asset trading platform accounts he controlled, with between 4.5 million and 7.4 million TRX wash traded daily.The SEC’s press release notes that this scheme required a significant supply of TRX, which Sun allegedly provided. As alleged, Sun also sold TRX into the secondary market, generating proceeds of $31 million from illegal, unregistered offers and sales of the token.SEC Chair Gary Gensler said:<blockquote>“This case demonstrates again the high risk investors face when crypto asset securities are offered and sold without proper disclosure”.</blockquote>Gurbir S. Grewal, Director of the SEC’s Division of Enforcement, added:<blockquote>“Sun and others used an age-old playbook to mislead and harm investors by first offering securities without complying with registration and disclosure requirements and then manipulating the market for those very securities”.</blockquote>Except for two of the celebrities charged, all others have agreed to pay a total of more than $400,000 in disgorgement, interest, and penalties to settle the charges, without admitting or denying the SEC’s findings.Read more cryptocurrency news on <a href="https://finbold.com/category/cryptocurrency-news/?utm_source&#61;CMC&amp;utm_medium&#61;social&amp;utm_campaign&#61;CMC&amp;utm_content&#61;long" rel="noopener noreferrer nofollow">Finbold.com</a>.

SEC sues Justin Sun and eight celebrities, including Akon, Ne-Yo for Fraud

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Finbold

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