The SEC, or United States Securities and Exchange Commission, has recently submitted fresh papers to the court for its ongoing case against Justin Sun, the creator of the TRON blockchain, and the suspected businesses under his management.
In their more recent submission to the Securities and Exchange Commission (SEC), further details have been given to bolster the accusations they made against Sun in March 2023. The SEC is charging Sun with conducting unregistered transactions, engaging in manipulative trading practices, and illegally promoting crypto asset securities.
Justin Sun Accused Of Orchestrating ‘Manipulative Wash Trading’
Based on SEC records, Justin Sun conducted transactions involving the selling and buying of two cryptocurrencies, TRX (Tron’s native token) and BTT (BitTorrent’s token), which were classified as securities by the US Securities and Exchange Commission through his ownership and management of companies such as Tron Foundation Limited, BitTorrent Foundation, and Rainberry.
According to the SEC’s perspective, the offerings and sales of TRX and BTT should have been registered with the commission or been exempt from registration. However, no such filings were made. Sun is accused of conducting public offers and sales of these tokens without complying with regulatory standards.
The SEC alleges that Justin Sun orchestrated deceitful trades of TRX tokens, resulting in a misleading impression of active investor participation and sustaining the token’s value.
According to the allegations, the Tron Foundation, BitTorrent Foundation, and Rainberry, together with their staff, are accused of carrying out large numbers of fake trades at Sun’s behest. These wash trades did not result in any actual transfer of ownership or serve a legitimate economic function.
SEC Seeks Restitution And Penalties
Along with the previous claims, it is alleged that Justin Sun misled investors by exaggerating the truth about his marketing efforts.
The SEC has highlighted that Justin Sun misrepresented on social media that celebrities endorsing TRON were required to disclose their remuneration. Nevertheless, the SEC asserts that Sun concealed payments given to these very celebrities for promoting TRON, suggesting a breach of anti-touting regulations.
The SEC argues that the actions of TRON’s founder have breached several regulations from the Securities Act of 1933 and the Securities Exchange Act of 1934. These infringements involve registration requirements, antifraud provisions, antimanipulation rules, and complicity in violations.
In their plea for forgiveness, the SEC asks the court to declare the defendants responsible for the suspected offenses, enforce long-term prohibitions and conduct modifications, prevent Justin Sun from holding positions in specific “registered securities companies,” recover ill-gotten earnings with pre-judgment interest, levy civil fines, and grant any additional remedies required to safeguard investors.
Justin Sun and his companies are now facing increased legal challenges from the SEC as they filed a new complaint. This includes accusations of selling unregistered securities, manipulating trades, and misrepresenting crypto assets.
As the situation unfolds, the final result is expected to bring about substantial consequences and widespread recognition for the rules governing digital assets.
TRX, the native currency of the TRON blockchain, is currently priced at $0.1110. After a prolonged decline, it experienced a notable increase of 1.4% within the last day.
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2024-04-20 06:11