4 Crypto Companies Pay $25,000 Fine To Texas State Securities Board

- Advertisement -

February 22, 2019 10:48 PM

The Securities Board claims the companies were selling unregistered securities and recruiting unregistered dealers and agents.

The Texas State Securities Board has reached an agreement with four cryptocurrency-related companies after filing an emergency cease and desist order in July 2018 claiming they offered investments in securities that were not registered in Texas. The companies have agreed to pay a $25,000 administrative fine and halt operations in Texas until the securities are registered with the Securities Commissioner.

The four companies involved in the agreement are Mintage Mining, BC Holdings and Investments, Social Membership Network Holding, and NUI Social. The document also names Darren Olayan, who, according to the original cease and desist order, controls Mintage Mining and NUI Social.

According to the agreement, Mintage Mining, BC Holdings and Investments, and NUI Social were offering investment opportunities in their “Hash Rate Unit Investment Program” and “Open-Ended Unit Investment Program.” Both programs were tied to crypto mining units, allowing investors to purchase the mining equipment and earn a share of the net mining revenue, minus hosting and management fees. Neither program was registered with the Securities Commissioner and were therefore not permitted to be sold in Texas.

The document also claims Mintage Mining, Social Membership Network Holding, NUI Social, and Olayan were recruiting individuals to act as sales agents in Texas without first verifying that those individuals were registered as dealers or agents with the Securities Commissioner. Not only were the recruits unregistered, Olayan and the four companies were also acting as unregistered dealers and agents.

- Advertisement -

The Texas State Securities Board has had a busy 2018 investigating cryptocurrency-related companies for possible fraud. In April 2018, ETHNews spoke with Joe Rotunda, director of the Board’s Enforcement Division which published a report detailing 32 investigations into promoters of crypto investments, none of whom were registered to sell securities in Texas. Rotunda found that, while plenty of businesses are working to develop legitimate crypto investments, promoters of fraudulent schemes were capitalizing on the technology’s hype.

More recently, on February 7, the Board published its 2018 Enforcement Report which stated that, in 2018, Securities Commissioner Travis J. Illes “entered 16 administrative orders against promoters of suspect cryptocurrency investments who were using online advertisements, social media, and other solicitations to attract Texas investors.” This included, of course, the emergency cease and desist order brought against BitConnect in January 2018.

Nicholas Ruggieri studied English with an emphasis in creative writing at the University of Nevada, Reno. When he’s not quoting Vines at anyone who’s willing to listen, you’ll find him listening to too many podcasts, reading too many books, and crocheting too many sweaters for his dogs, RT and Peterman.

- Advertisement -

Like what you read? Follow us on X @Bitnewsbot to receive the latest Texas, Texas State Securities Board or other Ethereum law and legislation news.



Previous Articles:

- Advertisement -

Latest News

Solo Bitcoin Miner Strikes Block, Earns $373K Amid Rising Difficulty

A solo Bitcoin miner earned $372,773 by mining block 907283 on Saturday.The block contained...

Coinbase Base App Rebrand Sparks Zora Token and SocialFi Surge

Coinbase rebranded its Wallet to the Base App on July 16, sparking a surge...

Solana Holds $177 Support as ETF Delays Weigh, Eyes $205 Rebound

Solana (SOL) saw its price fall by 3.2% this week after a strong rise...

Astronomer Turns Viral CEO Kiss Cam Scandal Into Data-Driven Win

Astronomer, a data infrastructure company, faced a viral public incident involving its CEO and...

Japan’s Crypto Bottleneck: Regulation, Not Taxes, Drives Talent Out

Regulatory approval delays are causing crypto startups to leave Japan.A proposed 20% flat tax...

Must Read

18 Countries With No Privacy Laws According To UN (List)

Privacy laws are legal frameworks designed to protect personal data from unauthorized access, misuse, or disclosure.Lack of privacy laws can lead to misuse of...