The US Securities and Alternate Fee has been handed a $1.1 million court docket victory after a person it accused of operating a crypto rip-off didn’t reply the company’s lawsuit.
A Georgia federal court docket choose submitted a default judgment within the SEC’s favor on June 3 in its case in opposition to Keith Crews, who failed to reply or defend himself against the SEC’s lawsuit that it filed in August 2023.
Decide Tiffany Johnson ordered Crews to pay monetary penalties of over $1.1 million, discovering him answerable for disgorgement of $530,000 in web earnings from his alleged misconduct and ordered him to pay prejudgment curiosity of just about $51,000 and a civil penalty of $530,000.
The choose dominated that Crews can be completely banned from future violations of securities legal guidelines.
The SEC alleged Crews carried out a crypto fraud scheme by way of his corporations, 4 Sq. Biz and Stem Biotech, between October 2019 and Might 2021.
The SEC claimed he raised at the least $800,000 from roughly 200 buyers by way of the sale of a “purported crypto asset safety” named “Stemy Coin,” and that most of the buyers had been “solicited by way of relationships in African-American and church communities.”
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The regulator accused Crews of constructing false claims to buyers, such because the token being backed by stem cell expertise and laborious property like gold, and that his firm had current labs, merchandise, and a monitor report of delivering stem cell remedies.
Pretend labs and partnerships
The SEC claimed Crews touted partnerships with docs and analysis groups, whereas in actuality, the agency had no labs, merchandise, analysis, companions or stem cell expertise.
“Crews and his entities had no current stem cell expertise, merchandise, or operations, there was no partnership with the claimed entities,” the company mentioned in its criticism.
The criticism alleged violations of a number of federal securities legal guidelines, together with Securities Act fraud provisions, Alternate Act fraud provisions and registration violations.
The judgment represents a uncommon crypto-related victory for the SEC, which has wound down its crypto enforcement actions underneath the Trump administration this yr.
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