The U.S. Securities and Exchange Commission (SEC) has initiated administrative action against American CryptoFed, a Wyoming-based decentralized autonomous organization (DAO), to issue a cease and desist order to suspend the registration of the offering and sale of Ducat and Locke tokens.
The SEC has started to display an official document on the subject to investors on its website.
SEC Will Sanction a US-Based DAO
The SEC said a Form S-1 registration statement made by American CryptoFed last year did not contain necessary information about the company’s business, management and financial condition.
The agency further said that the statement contained “significantly misleading statements and omissions, including inconsistent statements about whether the tokens are securities.”
Additionally, the Enforcement Department claims that American CryptoFed did not cooperate in the review of its registration statements.
David Hirsch, chief of the regulatory agency’s crypto assets and cyber unit, said in a statement:
“An entity wishing to register the offering and sale of crypto assets as securities transactions must provide the SEC with the necessary disclosure information.
American CryptoFed not only failed to comply with the disclosure requirements of federal securities laws, but also claimed that the securities transactions they sought to register were not actually securities transactions.”
SEC, the SEC’s investigation cryptocurrency The assets and cyber unit were led by Martin Zerwitz and Michael Baker, he said.
As is known, the SEC claims that the Ripple altcoin is also an unregistered security.
*Not investment advice.
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