SEC, BitFunder operator mark further progress in settlement discussions

Maria Nikolova

The US regulator and Jon Montroll continue to expect to resolve the civil case by agreement.

The United States Securities and Exchange Commission (SEC) and Jon Montroll, the person behind now-defunct Bitcoin platform BitFunder, continue to progress with settlement negotiations in a civil case brought by the US regulator. This becomes clear from a status report submitted to the New York Southern District Court on Thursday, September 20th.

The document says that the parties continue to expect to resolve the civil case by agreement, subject to approval by the Commission. This was already indicated in a report filed in August.

The defendants are set to submit a further status report on or about October 19. If the parties do not believe, at that time, that the case will be resolved by agreement, then they will so indicate.

Let’s recall that in February this year, the SEC charged Bitfunder, a former Bitcoin-denominated platform, and its founder – Jon Montroll, with operating an unregistered securities exchange and defrauding users of that exchange. The SEC also charged the operator with making false and misleading statements in connection with an unregistered offering of securities.

In its complaint, the SEC alleges that BitFunder was an unregistered online securities exchange and that Montroll defrauded exchange users by misappropriating their bitcoins and failing to disclose a cyberattack on BitFunder’s system that resulted in the theft of more than 6,000 bitcoins.The SEC also alleges that Montroll sold unregistered securities that purported to be investments in the exchange and misappropriated funds from that investment as well.

The SEC’s complaint charges BitFunder and Montroll with violations of the anti-fraud and registration provisions of the federal securities laws. The complaint seeks permanent injunctions and disgorgement plus interest and penalties.

In July this year, a plea agreement in the criminal case related to this proceeding was entered. Montroll, a/k/a “Ukyo,” pled guilty to securities fraud and obstruction of justice. Each of these charges carries a maximum penalty of 20 years, with Montroll to be sentenced by Judge Berman at a date to be determined.

Read this next

Technology

Sell-side analysts spend +30h/week manually closing/investigating alerts, says study

An independent report by Acuiti, and commissioned by Eventus, has found that the increasing complexity of trade surveillance requirements, driven by regulatory demands and exacerbated by volatility, is putting pressure on manual processes and driving investment in automation. 

Digital Assets

Silvergate dismisses speculation of trouble, says BlockFi exposure is minimal

Crypto-friendly bank Silvergate Capital claimed on a Tuesday blog post that it had minimal exposure to crypto lender BlockFi, which filed for chapter 11 bankruptcy protection this week.

Retail FX

Fidelity launches crypto trading for retail investors

Fidelity Investments, one of the largest brokerages in the world, has officially rolled out a commission-free crypto trading product for retail investors, starting with zero-fee trading for Bitcoin and Ethereum.

Digital Assets

ECB head calls for tougher crypto regulation after FTX collapse

President of the European Central Bank, Christine Lagarde, has called on lawmakers to start working on fresh crypto regulations to protect the financial system after the collapse of the FTX exchange.

Retail FX

CySEC updates rules for regulated brokers’ cross border activity

As CySEC’s attitude of adopting more stringent licensing guidelines and operating regulations becomes ever clearer, certain aspects of the rules and operations start to come into sharper focus.

Market News

Outlook for Gold: Can the Precious Metal Regain Power?

Gold set an all-time high at $2070 on March 08, 2022, when the price skyrocketed amid investors’ worries about the military conflict in Eastern Europe.

Crypto Insider

2022 Islamic Finance recap: as the space continues to evolve, blockchain stands to play a big part

Despite the global economy being ravaged by turmoil induced by the Covid-19 pandemic over the last couple of years, the Islamic finance industry has emerged relatively unscathed

Crypto Insider

Decentralized Exchanges and Pooled Trading Platform Applications

Decentralized exchanges are one-way blockchain companies take back the power of value creation.

Crypto Insider

How to maximize the safety of your digital tokens?

Digitalization is the future of the investment world. These are the most preferred and growing investments in the world.

<