SEC Collects $2.8 Million In Fines After Purging Hydro
Key Points:
- A lawsuit filed by the SEC against a cryptocurrency corporation in September 2022 has finally resulted in a $2.8 million settlement.
- The complaint in issue accused Hydro Technologies and its former CEO of marketing cryptocurrency known as Hydro.
- They were accused of running a plan to influence the trading volume and price of certain securities.
In order to resolve a Securities and Exchange Commission complaint accusing them of manipulating the price of a digital token known as Hydro, a financial technology company and its former CEO agreed to pay more than $2.8 million and cease trading cryptocurrencies.
A federal court in New York authorized a settlement deal between the SEC and Miami-based Hydro Technologies on Thursday. Co-founder and former CEO Michael Kane also agreed to conclude the legal fight.
The complaint accused Hydro Technology Inc. and its former CEO, Michael Ross Kane, of participating in the unregistered offers and sales of Hydro. They were also accused of running a plan to influence the trading volume and price of those assets, which netted Hydrogen more than $2 million.
Hydrogen has agreed to pay a total of over $2.8 million as part of the settlement, which includes nearly $1.5 million in disgorged earnings, a penalty of more than $1 million, and prejudgment interest. Michael Kane, on the other hand, has consented to pay a punishment of about $260,000.
The regulatory authority filed a case against two persons in September, saying that they bribed a third party to influence the trading of the company’s Hydro token in order to artificially inflate its price. Tyler Ostern, the third person in issue, agreed to settle the matter for $41,000 the day after the complaint was filed.
Carolyn M. Welshhans, Assistant Director of the Securities and Exchange Commission’s Enforcement Division, said at the time:
“As our enforcement action shows, the SEC will enforce the laws that prohibit such unregistered fund-raising schemes in order to protect investors.”
Both the company and Kane are constrained by the terms of the settlement, which provide that they cannot confirm or deny the allegations levied against them.
Moreover, they will be prohibited from selling any further cryptocurrencies until they have passed the Howey test and gotten SEC permission. Kane, on the other hand, will be allowed to participate in the larger crypto market and continue trading cryptocurrency for himself.
According to the SEC’s complaint, Kane and Hydrogen, a New York-based financial technology company, created the Hydro token in January 2018 and then publicly distributed it through various methods, including an “airdrop,” which is essentially giving the token away to the public; bounty programs, which paid individuals in exchange for promoting it; employee compensation; and direct sales on crypto asset trading platforms.
The complaint said that after distributing the token in these ways, Kane and Hydrogen hired Moonwalkers, a South African-based firm, in October 2018 to create the false appearance of robust market activity for Hydro by using its customized trading software or “bot” and then selling Hydro into that artificially inflated market for profit on Hydrogen’s behalf.
DISCLAIMER: The information on this website is provided as general market commentary and does not constitute investment advice. We encourage you to do your own research before investing.
Join us to keep track of news: https://linktr.ee/coincu
Harold
Coincu News
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SEC Collects $2.8 Million In Fines After Purging Hydro
Key Points:
- A lawsuit filed by the SEC against a cryptocurrency corporation in September 2022 has finally resulted in a $2.8 million settlement.
- The complaint in issue accused Hydro Technologies and its former CEO of marketing cryptocurrency known as Hydro.
- They were accused of running a plan to influence the trading volume and price of certain securities.
In order to resolve a Securities and Exchange Commission complaint accusing them of manipulating the price of a digital token known as Hydro, a financial technology company and its former CEO agreed to pay more than $2.8 million and cease trading cryptocurrencies.
A federal court in New York authorized a settlement deal between the SEC and Miami-based Hydro Technologies on Thursday. Co-founder and former CEO Michael Kane also agreed to conclude the legal fight.
The complaint accused Hydro Technology Inc. and its former CEO, Michael Ross Kane, of participating in the unregistered offers and sales of Hydro. They were also accused of running a plan to influence the trading volume and price of those assets, which netted Hydrogen more than $2 million.
Hydrogen has agreed to pay a total of over $2.8 million as part of the settlement, which includes nearly $1.5 million in disgorged earnings, a penalty of more than $1 million, and prejudgment interest. Michael Kane, on the other hand, has consented to pay a punishment of about $260,000.
The regulatory authority filed a case against two persons in September, saying that they bribed a third party to influence the trading of the company’s Hydro token in order to artificially inflate its price. Tyler Ostern, the third person in issue, agreed to settle the matter for $41,000 the day after the complaint was filed.
Carolyn M. Welshhans, Assistant Director of the Securities and Exchange Commission’s Enforcement Division, said at the time:
“As our enforcement action shows, the SEC will enforce the laws that prohibit such unregistered fund-raising schemes in order to protect investors.”
Both the company and Kane are constrained by the terms of the settlement, which provide that they cannot confirm or deny the allegations levied against them.
Moreover, they will be prohibited from selling any further cryptocurrencies until they have passed the Howey test and gotten SEC permission. Kane, on the other hand, will be allowed to participate in the larger crypto market and continue trading cryptocurrency for himself.
According to the SEC’s complaint, Kane and Hydrogen, a New York-based financial technology company, created the Hydro token in January 2018 and then publicly distributed it through various methods, including an “airdrop,” which is essentially giving the token away to the public; bounty programs, which paid individuals in exchange for promoting it; employee compensation; and direct sales on crypto asset trading platforms.
The complaint said that after distributing the token in these ways, Kane and Hydrogen hired Moonwalkers, a South African-based firm, in October 2018 to create the false appearance of robust market activity for Hydro by using its customized trading software or “bot” and then selling Hydro into that artificially inflated market for profit on Hydrogen’s behalf.
DISCLAIMER: The information on this website is provided as general market commentary and does not constitute investment advice. We encourage you to do your own research before investing.
Join us to keep track of news: https://linktr.ee/coincu
Harold
Coincu News
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