Get 40% Off
🚨 Volatile Markets? Find Hidden Gems for Serious OutperformanceFind Stocks Now

Crypto startup AriseBank settles fraud accusations with SEC

Published 12/12/2018, 04:56 PM
Updated 12/12/2018, 05:00 PM
© Reuters. FILE PHOTO: To match Special Report SEC/INVESTIGATIONS

(Reuters) - Cryptocurrency startup AriseBank will pay $2.3 million to the U.S. Securities Exchange Commission (SEC) to settle accusations of defrauding investors through claims such as building a cryptocurrency bank.

AriseBank founders Jared Rice and Stanley Ford will pay civil penalties of $184,767 each and will be prohibited from serving as officers of public companies or participating in offerings of digital securities, the SEC said in a statement.

The company is one of the first to be sued by U.S. regulators over its initial coin offering.

Earlier this year, the SEC had halted what it alleged was a fraudulent initial coin offering by AriseBank to raise $1 billion for its "AriseCoin" cryptocurrency, which was considered one of the largest initial coin offerings ever.

The SEC had said it obtained a court order to halt AriseBank's efforts to target investors, alleging that the entity had "falsely stated that it purchased an FDIC-insured bank" and had "omitted to disclose the criminal background of key executives."

The court had also ordered the freezing of AriseBank's assets, while approving the appointment of a receiver for those assets tied to the ICO fraud.

Latest comments

Risk Disclosure: Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.
© 2007-2024 - Fusion Media Limited. All Rights Reserved.