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The U.S. Securities and Exchange Commission (SEC) announced on Friday that Coinme, a company that operates Bitcoin (BTC) kiosks, has agreed to pay almost $4 million to settle charges related to its involvement in an unregistered security offering.
Coinme, its subsidiary Up Global SEZC and the CEO of both entities, Neil Bergquist, were all named in the order for allegedly running a crypto fundraiser known as an initial coin offering (ICO) in 2017 for "UpToken." The SEC accused the parties of "making false and misleading statements concerning the demand for UpToken and the amount raised in the offering."
This order is the most recent in a series of enforcement actions and significant fines by the securities regulator, which have led some companies to close part or all of their operations.
The SEC alleged Bergquist and Up Global worked to obtain UpToken supply "that would substantially reduce Coinme's need to purchase UpToken" following the ICO, leading to "publicly inflated amounts raised."
The regulator has stated that, to resolve the allegations, Up Global has agreed to pay a penalty of $3,520,000, while Coinme has agreed to pay a separate penalty of $250,000, and Bergquist has agreed to pay $150,000.
"The SEC order also bars Bergquist, for a period of three years, from acting as an officer or director of a public company," the announcement said.
Coinme operates Bitcoin ATMs across nearly 49 U.S. states and, in August, added several popular cryptocurrency tokens to its grocery store kiosks.
Source Coindesk
