- SEC sues Unicoin for $100M fraud tied to fake property claims and inflated sales.
- Executives allegedly marketed tokens with false promises of extreme investment returns.
- SEC seeks penalties and leadership bans; CEO vows to contest charges in court.
The U.S. Securities and Exchange Commission has filed a lawsuit against cryptocurrency company Unicoin and four of its senior leaders, accusing them of conducting a fraudulent investment scheme worth more than $100 million.
The SEC’s filed complaint outlines multiple alleged violations of federal securities laws. These include Unicoin making false claims about its token offerings being backed by real estate, inflating its sales figures, and improperly marketing investment products. Information about the lawsuit also appeared in a post from Eleanor Terrett on X.
SEC Alleges Unicoin Made False Real Estate Claims, Inflated Sales by Billions
According to the SEC’s complaint, Unicoin executives promoted the company’s token offerings as backed by real estate holdings. Between September 2023 and January 2024, the defendants claimed to have acquired properties in Argentina, Thailand, Antigua, and the Bahamas, collectively valued at over $1.4 billion.
The SEC alleges, however, that most of these deals never actually closed. The agency further states that the true value of the few property transactions that were completed did not top $300 million.
In addition, the SEC says Unicoin overstated the volume of rights certificates it sold to investors. The company publicly claimed it raised $3 billion by June 2024. But, the SEC found that Unicoin’s total sales did not go above $110 million.
Related: SEC Targets Unicoin in Crackdown on Crypto as Gensler’s Resignation Nears
Unicoin CEO Konanykhin, Other Leaders Face Fraud, Unregistered Sales Charges
The lawsuit specifically names Unicoin’s CEO, Alexander Konanykhin, former board chair Maria Moschini, general counsel Richard Devlin, and former chief investment officer Alejandro Dominguez as defendants. Konanykhin is accused of personally selling nearly 38 million rights certificates to investors who are not qualified to purchase them under securities laws.
The complaint also points out an aggressive marketing campaign led by the company, which allegedly included promises of extraordinary returns, with claims of up to 9 million percent gains. These advertisements appeared across public spaces, including taxis, digital billboards, elevator screens, ferries, television broadcasts, news sites, and public Wi-Fi kiosks.
Aggressive Marketing Promised “9 Million Percent Gains,” SEC Complaint States
The Commission requests a full range of penalties, including permanent injunctions, financial disgorgement, and civil penalties. It also seeks to ban the three named senior executives from serving as officers or directors.
Related: Less Enforcement, More Clarity? Atkins Lays Out Future SEC Agenda at Hearing
In response to the lawsuit, Konanykhin said he plans to fight the charges in court and called the case unjust. He described Unicoin as the most compliant crypto company in the U.S. and claimed the SEC unfairly targeted it.
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