The SEC revealed on recently that it has won a temporary asset freeze and a restraining order against an alleged fraudulent scheme based in Utah that raised almost $50 million by selling cryptocurrency to hundreds of American investors.
The SEC accused DEBT Box, a firm situated in Draper, Utah, as well as its four founders and 13 other defendants of running a fraud that started in March 2021 to market unregistered securities known as “node licences.” The SEC claims that defendants misled investors by representing that the licences would mine cryptocurrencies whose value would rise when, in fact, they were instantly producing the cryptocurrencies by running code on a blockchain.
“We allege that DEBT Box and its principals misrepresented to investors virtually every material aspect of their unregistered offering of securities, including by falsely representing that they were engaged in crypto asset mining,” said Tracy S. Combs, Director of the SEC’s Salt Lake Regional Office, in a statement. In order to safeguard the victims of the defendants’ illegal activities and prevent additional injury, we filed this emergency action.