It has previously been reported that the US Securities and Exchange Commission filed a complaint against a new york-based businessman and his 2 entities for allegedly running an unregistered and fraudulent ICO from late 2017 to 2018 which raised almost $15 million. As part of the SEC’S actions against the man and his entities, a request had been made to the court to have $8 million of the entity’s assets frozen while investigations are being conducted as well as some other measures to aid the investigation.

According to court documents published August 13, 2019, the US states District Court has granted an emergency freezing of the $8 million in assets of Reginald Middleton and his two Enterprises under management, Veritasium Inc. and Veritasium LLC which are under investigation for violating the registration and anti-fraud provisions of the US federal securities laws as well as for fraudulent trading.


The company had run an ICO at the time to sell tokens called VERI which were issued on the Ethereum blockchain and pegged to ether at a 30:1 ratio. The tokens have been marketed as utility tokens that could be redeemed for various benefits which include consulting, advisory services and access to an unlimited amount of research. The SEC is going after them and seeking for them to pay permanent injunctions, disgorgement, interest, and penalties as well as to be banned from offering digital Securities.

“After learning about Middleton’s transfer of funds, we took quick action to prevent the further dissipation of investor assets. Whether in digital currency or plain cash, we will act to protect investor assets and to pursue fraud and manipulation in our securities markets,” said Marc P. Berger, director of the SEC’s New York Regional Office. 

According to official word from the courthouse, the judge granted the approval of the temporary injunction and the defendants will be required to show cause on August 22 and the case has been resigned to Judge William F. Kuntz, II. 

Even though ICOs are no longer being all the rage, the SEC is still having to go after various companies that have had them in the past due to how unregulated the market was at the time. This also speaks volumes about how much regulation the SEC has had to implement within the crypto industry in general because certain regulations do not already exist and there are also dishonest people within the industry.

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