Blockchain Crime

The SEC Closes in on an Alleged “pump and Dump” ICO Scheme

Pump and dump schemes have been the order of the day for months now, with unscrupulous characters trapping investors then making a killing after managing to pull money into a digital asset. This horrible malpractice has caught the attention of the United States security agency who have filed a subpoena enforcement action against those behind an alleged “pump and dump” scheme that revolved around a 100 million dollar ICO. The securities and exchange commission (SEC) filed the subpoena on 5th October at the US district court for the central district of California against the “Saint James holding and investment company trust and its sole trustee, jefree jame”

The subpoena was filed after the SEC moved to suspend activity on a penny stock firm called “cherubim interests, unc” last February. The SEC is of the belief that Cherubim issued false public statements such as the claim that the company had executed a 100 million financing commitment to launch an ICO for ST James Trust. According to the filing by the SEC, Cherubim’s stock price shot up owing to this news and it is suspected that some individuals may have dumped their overvalued cherubim stock for significant profits. The SEC’s archives contain a memorandum of understanding that outlined cherubim’s alleged ICO financing commitment. It further outlined a so-called self-sustaining intentional communities coin (SJT) that would create enough capital to “create self-sustaining intentional communities across the US and across 57 nations”.

The SEC explained their decision yesterday on why they suspended trading on cherubim stocks, stating that they had reason to doubt the accuracy of Cherubim’s financial disclosures. According to the February suspension order, cherubim is said to have issued press releases in January claiming that it had acquired “AAA-rated assets from a subsidiary of a private equity investor in cryptocurrency and the blockchain. The SEC also has Cherubim backed up in a corner for not filing reports for the fiscal year ending August 2017 as well as a quarterly report last November.

The SEC stated yesterday that despite having issued the subpoenas and also serving the trustees with copies of the subpoenas neither the trust nor the trustee responded to the agency nor produced the required documents. The agency, therefore, sought an order from the court compelling both to produce all responsive documents. The agency has openly stated that fact-finding investigations are still ongoing and at the moment and as of yet, no breach of securities laws has been seen.

Author: Kelvin

I am a crypto enthusiast based in Nairobi Kenya, who loves investing, research writing, reading, fitness, African food, and soccer.

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I am a crypto enthusiast based in Nairobi Kenya, who loves investing, research writing, reading, fitness, African food, and soccer.
I am a crypto enthusiast based in Nairobi Kenya, who loves investing, research writing, reading, fitness, African food, and soccer.

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