The U.S. Securities and Exchange Commission (SEC) filed a sweeping lawsuit Tuesday night against cryptocurrency firm Unicoin and four of its senior figures, accusing the company of orchestrating a massive fraud scheme that misled investors and falsely claimed its tokens were backed by real estate holdings worth over $1.4 billion.
Unicoin, its CEO Alexander Konanykhin, former board chair Maria Moschini, general counsel Richard Devlin and ex-investor relations officer Alejandro Dominguez are all named in the civil complaint brought in federal court. SEC experts say that the group broke the law by representing and selling Unicoin using false statements and falsified assets.
SEC Says Unicoin Misled About Holdings
According to the SEC, Unicoin never had the properties it said were backing its tokens. From September 2023 to January 2024, the company said it would acquire businesses in Argentina, Thailand, Antigua and the Bahamas. Unicoin said the development’s appraised values amounted to more than $1.4 billion.
According to the SEC, the vast majority of the transactions failed and the total value of the properties didn’t top $300 million. These statements were serious lies deliberately designed to reassure investors, the U.S. Securities and Exchange Commission complaint added.
SEC Investigates Exaggerated Profit Projections
According to the regulator, Unicoin misrepresented its earnings from investment certificates, saying it raised $3 billion from sales in mid-2024. In its opinion, the U.S. Securities and Exchange Commission says that no more than $110 million was taken in the fraud.
Even marketing approaches are being closely examined now. Unicoin is claimed to have advertised “rights certificates” in taxis, elevators, on billboards, coasters and Wi-Fi kiosks around cities, offering as much as 9 million percent profit.
Unicoin Evokes Bitcoin to Lure Investors
According to the message, some people who invested in Bitcoin in its early days became millionaires or billionaires. You can get Unicoin at its early stage today, so don’t miss out.
The U.S. Securities and Exchange Commission gave Unicoin a Wells notice in December 2024 to indicate it was considering launching an enforcement action. However, resolutions were not made. In a shareholder letter, CEO Konanykhin explained that in April, the company refused to take part in an SEC settlement meeting because it considered the proposal an ultimatum.
Konanykhin told CoinDesk that the firm declined to appear since the SEC made it difficult by setting hard requirements, leading to several billions in damages, he said.
Unicoin Silent Amid Mounting Legal Pressure
Unicoin declined to comment on this issue. In a past press announcement, the company said it has always followed U.S. rules and described itself as the only fully registered, audited, reported and regulated cryptocurrency business in the U.S.
The Commission has requested that any profits wrongfully gained and civil fines be returned. A successful outcome in the lawsuit could make it a major crypto fraud case since FTX.
It represents the SEC’s ongoing efforts to address misleading actions in the cryptocurrency area, as regulators become stricter due to many scandals and investor damage. A decision in this case is still pending in U.S. District Court. Court proceedings will likely lead to further new information.
Conclusion
Unicoin’s case with the SEC could shape how future crypto violation cases are handled. During the investigation, we can see that regulators are paying more attention to the digital assets sector. Because of possible penalties, crypto businesses may need to change their marketing, fundraising and investor explanations.
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FAQs
Q1: Why is the SEC suing Unicoin?
For allegedly misleading investors about real estate backing and inflating sales.
Q2: What properties did Unicoin claim to own?
Real estate in Argentina, Thailand, Antigua, and the Bahamas.
Q3: How much did Unicoin actually raise?
Around $110 million, not the $3 billion it claimed.
Q4: What is the SEC seeking?
Disgorgement of funds and civil penalties.
Glossary Of Key Terms
SEC: U.S. agency regulating securities and protecting investors.
Unicoin: Crypto company sued for fraud by the SEC.
Rights Certificates: Investment certificates sold by Unicoin.
Real Estate Backing: Claim that tokens are supported by properties.
Wells Notice: SEC’s formal warning about possible enforcement.
Civil Penalties: Fines for breaking laws.
Fraud Charges: Accusations of intentional deception.
References
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