May 19, 2024

Court rejects SEC petition for Telegram banking documentation

The Southern District of New York court rejected the SEC's request to provide information on banking transactions anduse of funds raised by the TON project as part of the ICO.

Yesterday, January 6th, after a conference callwith the participants in the proceedings, Judge Peter Kevin Castel signed a decree according to which the application of the US Securities and Exchange Commission (SEC) to provide banking software by Telegram is rejected.

Recall that Telegram raised about $ 1.7 billion through the sale of Gram tokens during the investment campaign, which lasted from January to March 2018 and which, in the opinion of the Commission, is an unregistered sale of securities. In its application, the SEC said that the defendants refused to provide information on how the funds raised were spent.

The regulator is sure that the requested documents haverelevant to the case of a potential violation of Telegram's securities laws, including data on the amount of money already spent during the development of the TON blockchain platform. In addition, the documents could contain information on how much commission Telegram paid to investors for the resale of Gram to other market participants.

However, Telegram lawyers are confident that the SEC’s actions are only an attempt to find incriminating evidence on the company without any reason.

“SEC wants to get extensive and confidentialdata that are weakly related to the current case or have no relation to it at all. The plaintiff in his letter distorts the legal aspects of the case and misses the critical facts, ”the lawyers said.

However, at the moment it still exists.the likelihood that the SEC will gain access to at least part of the requested information. By January 9 of this year, Telegram must submit a declaration stating the schedule for checking bank records to ensure their compliance with foreign data privacy laws.

In a letter that the company sent to court,it is said that Telegram has already provided the regulator with information on expenses for the period from January 1, 2018 to January 31, 2019. According to the company, this is quite enough. In addition, on January 7-8, the founder and CEO of Telegram Pavel Durov should testify in the current proceedings in Dubai.