October 29, 2020

The court ordered the organizer of the ICO project Veritaseum to pay $ 9.5 million

The US Securities and Exchange Commission (SEC) announced the completion of the proceedings with Reggie Middleton, who raised $ 14.8 million in 2017 through an initial offer of coins.

According to the documents of the New York District Court, without admitting or rejecting his guilt, Middleton agreed to pay $ 9.5 million in compensation for illegally misappropriated funds and a fine.

Middleton by ForkLog on Scribd

According to the SEC, Middleton raised funds without registering with the agency. To maximize the amount of money collected, he misled investors by disseminating false information.

Veritaseum was created as a financialP2P platform, involving the movement of capital without traditional intermediaries. Also, VERI was positioned as a utility token for use in consulting services and access to various research works.

One week after the end of the Tokensale Middletonstated that the hacker stole 36,000 project tokens (more than $ 8 million at the time), and then exchanged them for Ethereum. According to documents, these funds are still not found.

In addition, the SEC accused Middleton ofmanipulating the price of the token after the ICO, as well as misappropriating at least $ 520 thousand for its own needs. In August this year, at the request of the SEC, Middleton's assets were frozen.

Recall that earlier the SEC sued the Kik project because of an unregistered ICO held in 2017. The trial continues to this day.