Many people don’t understand the ways in which online trading is regulated and others find that it is all too easy to make mistakes in the marketplace. Still others have actively sought to take advantage of this unique opportunity in ways that skirt the law. As a result of these realities, not only have many individual investors run afoul of the law by the way that they conducted their personal financial transactions, but there have also been an increasing number of professionals and businesses facing enforcement efforts by federal regulatory agencies over misconduct related to digital assets in recent months.
For example, at the end of April, the Securities and Exchange Commission (SEC) announced the end of an investigation and a settlement involving allegations of securities fraud related to online trading. The case resulted in millions of dollars in penalties and professional consequences for an executive.
What the SEC announced
After a lengthy investigation, the SEC reached a conclusion that a business, its owner and one of its subsidiaries violated key federal regulations in 2017. The Seattle-based company Coinme Inc was one of three parties that faced the now-settled charges. This case involved not just questionable statements to investors but also unregistered sales of securities in the form of crypto assets.
Between statements made to investors and behind-the-scenes trades that occurred, the financial activities of the organization, its subsidiary and its chief executive officer impacted the market illegally. The three defendants settled without admitting guilt and agreed to pay almost $4 million combined in penalties. The CEO implicated will not be able to serve as an officer or director at a publicly traded company for three years.
Financial crimes often lead to complex criminal cases
It takes quite a bit of investigation and evidence for the state to bring a financial criminal case against a business or professional. The average person implicated in a financial crime, like securities fraud, would have a hard time reviewing the evidence the state has gathered and either successfully defending themselves or negotiating a settlement that minimizes their consequences.
Proper legal guidance can make all the difference for those who are facing federal prosecution related to allegations of financial crimes. Seeming small mistakes can lead to major financial and professional consequences. Those who are concerned about possible financial or criminal penalties related to financial or business activities may want to speak with the attorneys at Ford O’Brien Landy LLP to better protect their interests.
Source: The Securities and Exchange Commission, “SEC Charges CEO and Subsidiary of Seattle-Based Company with Securities Fraud” Date Published: April 28, 2023