SEC Takes Emergency Action Against BKCoin
- The SEC has already targeted crypto companies such as Kraken, Genesis, and Gemini.
- Recent reports reveal that Binance attempted to hire Gary Gensler as an adviser before he took up his role with the SEC.
- Gensler believes cryptocurrencies and tokens other than Bitcoin are unregistered securities.
The US Securities and Exchange Commission (SEC) isn’t backing down from its bid to cleanse the crypto space of bad players and recently announced that it had taken emergency action against investment adviser BKCoin Management, which it said was linked to a fraud scheme.
The SEC claimed in a statement released on Monday that BKCoin Management raised $100 million from up to 55 investors to invest in cryptocurrencies but instead spent the money on lavish purchases and “Ponzi-like payments.” Kevin Kang, one of the principals of BKCoin Management, is accused by the SEC of falsifying paperwork and misappropriating at least $371,000 from investors to pay for vacations and an apartment.
Eric Bustillo, director of the SEC’s Miami Regional Office, explained in a statement,
As we allege, investors entrusted their money to the defendants to trade in crypto assets. Instead, the defendants misappropriated their money, created false documents, and even engaged in Ponzi-like conduct. This action highlights our continued commitment to protecting investors and uprooting fraud in all securities sectors, including the crypto asset arena.
The SEC noted that it has already frozen assets and obtained other forms of immediate remedies against BKCoin. The regulator is now requesting disgorgement, prejudgment interest, civil penalties, and permanent injunctions against BKCoin and Kang.
The SEC has long had a hard line on the cryptocurrency sector. The commission previously had its sights on alleged unregistered securities sales such as token sales and initial coin offerings (ICOs). However, the SEC has stepped up its enforcement efforts under the leadership of Gary Gensler, who has voiced his belief that all coins and tokens, with the exception of Bitcoin, are unregistered securities.
Lawrence has covered some exciting stories in his career as a journalist, he finds blockchain-related stories very intriguing. He believes Web3 will change the world and wants everyone to be a part of it.
