Home CryptoCurrency News Shopin Founder Settles with the SEC After Paying $450K Fine in Ether...

Shopin Founder Settles with the SEC After Paying $450K Fine in Ether for Alleged ICO Fraud

Israeli national Eran Eyal, the founder, and former chief executive officer of blockchain startup Shopin has agreed to settle a lawsuit brought against him for allegedly conducting a fraudulent ICO in New York back in 2019.

According to a release by the US financial regulator the Securities and Exchange Commission (SEC) on Tuesday, Eyal has agreed to forfeit Ether tokens to the tune of 3,105.78 which are to cover his fine together with alleged sums gotten through disgorgement of ICO investors in his December 2019 Shoping ICO. The forfeited Ether was part of the assets that were recovered in December when the Shopin project was closed down following a lawsuit brought against it by the New York Attorney General.

According to the SEC release, Shopin raised $42.5 million from investors through the use of misleading promotional statements that were targeted at potential and actual investors. The SEC also claimed in its December lawsuit filed a day before the lawsuit by the NY Attorney General that Shoppin sold unregistered securities which is an offense against the US Securities Act of 1934.

Last week, on June 19th, a U.S. District Court for the Southern District of New York gave the judgment that Eyal was guilty of conducting a fraudulent ICO in favor of the lawsuit brought before the court by the AG. Eyal consented to the charges by the AG but neither denied nor consented those by the SEC. However, the SEC was satisfied with the court determination which went beyond the fine and return of disgorged funds. Eyal was also barred from conducting any future public offerings or being part of any while also acting as an officer or director of a publicly listed company.

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“Without admitting or denying the allegations of the SEC’s complaint, Eyal consented to the entry of the order, which enjoins him from future violations of the registration provisions of Sections 5(a) and 5(c) of the Securities Act of 1933 and the antifraud provisions of Section 17(a) of the Securities Act and Section 10(b) of the Securities Exchange Act of 1934 and Rule 10b-5,” the SEC reported.

The fines include $422,100 in ill-gotten gains plus $34,940 in prejudgment interest which the SEC deemed paid through the forfeiture of the ether tokens. The SEC has since dropped its suit. Additionally, according to a report by Ventureburn, it seems Eyal was deported back to Israel by the US Immigration and Customs Enforcement.


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Omar Jones
Omar Jones
Senior news editor at Crypto Economy. Responsible for research and writing breaking news and featured reports. Introduced to crypto-economy in 2016, and now educating students and investors in the blockchain industry during their free time.
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