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“Coin Offerings” Can Constitute Securities Sales

Digital "Coin Offerings" Can Constitute Securities Sales

By Evan Weinberger of Law360.com The U.S. Securities and Exchange Commission on Tuesday brought some clarity to the market for “initial coin offerings” when it outlined a test for treating the digital “tokens” that are offered in exchange for money or digital currency as securities, but experts say key questions remain about certain types of tokens that defy easy categorization. The SEC released an investigative report into a German group known as The DAO, a so-called decentralized autonomous organization that used blockchain technology to raise about $150 million last year. The report found that the tokens like those used in The DAO’s...

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Chicago ‘Mini-Madoff’ Gets Nearly 6 Years In $1.7M Fraud

Chicago 'Mini-Madoff' Gets Nearly 6 Years In $1.7M Fraud

By Jon Hill of Law360.com A 26-year-old Chicago man was sentenced Wednesday in Illinois federal court to nearly six years behind bars after copping to conning investors out of more than $1.7 million in what federal prosecutors have called a “mini-Bernie Madoff scam.” Randall Rye, who pled guilty in April to one count of wire fraud in connection with the scam, was ordered by U.S. District Judge Ronald A. Guzman to serve a 70-month sentence in federal prison followed by three years of supervised release and pay back his investors $1.72 million in restitution. The prison term handed down by the judge is at the...

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CFTC Wins Asset Freeze In $13M Churchgoer Ponzi Suit

CFTC Wins Asset Freeze In $13M Churchgoer Ponzi Suit

CFTC Wins Asset Freeze In $13M Churchgoer Ponzi Suit By Martin O'Sullivan of Law360.com An Arizona federal judge issued an asset freeze Thursday against a man accused by the U.S. Commodity Futures Trading Commission of tricking Mormon church members into investing in a $13 million trading scheme that funded his personal expenses and Ponzi scheme payments. In its May complaint, the CFTC says that Cory Williams, founder of Williams Advisory Group LLC, told at least 40 investors that they were earning a pretty penny while he traded futures contracts on their behalf, when he was actually using $3.4 million of their investments on...

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SEC Settles With Fraudster Over $6M Startup Stock Scheme

SEC Settles With Fraudster Over $6M Startup Stock Scheme

By Jon Hill of Law360.com A New Jersey man struck a deal in New Jersey federal court on Friday to settle the U.S. Securities and Exchange Commission’s claims that he participated in an alleged scheme to pocket more than $6 million investor dollars raised for stock in a technology startup. James R. Trolice, who pled guilty in April to securities fraud and money laundering charges in a related criminal case, agreed to pay disgorgement of ill-gotten gains, interest and a civil monetary penalty in amounts to be determined at a later date, according to the settlement agreement filed by the SEC. Trolice also consented...

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Hedge Fund Manager Cops Guity Plea for Multi-Million Dollar Ponzi Scheme

Hedge Fund Manager Cops Guity Plea for Multi-Million Dollar Ponzi Scheme

Recently a Virginia hedge fund manager pled guilty to a $9 million Ponzi scheme. The case dealt with over 50 clients who invested in the investment manager’s hedge fund where he bragged of earning returns regularly beating the S & P 500. In reality, he both spent his clients’ monies on his living expenses and used the monies to cover losses he generated in trading activities. In typical Ponzi scheme fashion, he used new investor funds to pay off older investors who decided to cash out....

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