The United States Securities and Exchange Commission has just put out an “emergency lawsuit” in an attempt to stop Veritaseum, a platform that builds “blockchain-based, peer-to-peer capital markets as software on a global scale” from spending the money it “earned” via its recent ICO, reports The Block.
According to the SEC, this ICO was put out by the company on purpose, intentionally misleading consumers about its previous successes on top of lying regarding its cryptocurrency asset otherwise known as a VERI token. It took place back in late 2017 and went on into early the next year. As the SEC states, Veritaseum and Reginald Middleton, the “Disruptor-in-Chief” of the project, tried to classify its VERI assets as “pre-paid fees, software, or gift cards:”
“Cognizant of the federal securities laws’ application to VERI, Defendants so-called “utility” token, claiming that the VERI tokens’ supposed uses were variously as (1) a “prepaid fee” that could be exchanged for “consulting and advisory services” and used to buy “unlimited access to research,” (2) a “universal key to gain access to Veritaseum P2P OTC Direct Contracts,” and (3) a means to access “Veritaseum Legacy Asset Exposure Pools.”
Essentially, the SEC calls these assets securities. They also call out the project for claiming to have shippable products, among other false claims that investors paid good money because of.
The publication believes that the SEC has put this filling out because the project “moved more than $2 million in remaining offering proceeds from a blockchain address they controlled into other addresses, and used a portion of those funds to purchase more precious metals.”
So, since Veritaseum is actually doing something with the money they raised, the SEC is suing them for doing so, since they knowingly took funds that they deserve, that they acquired by lying about their efforts. We’ll have to see how this plays out.