New Jersey Sues Pocketinns for Selling Unregistered Securities

The state of New Jersey has filed a complaint against Pocketinns for selling unregistered securities through an Initial Coin Offering (ICO) Initial Coin Offering (ICO) An Initial Coin Offering (ICO) is a kind of crypto token sale that is used as a method of fundraising, similar to an Initial Public Offering (IPO), in which stocks are sold to raise money for a company.In order to launch an ICO, a company simply needs to create a website, issue a token, and set a time and date for the sale. Investors buy ICO tokens in exchange for another cryptocurrency, like Bitcoin or Ethereum; after a set amount of time, they receive the tokens they purchased in the sale.Acco An Initial Coin Offering (ICO) is a kind of crypto token sale that is used as a method of fundraising, similar to an Initial Public Offering (IPO), in which stocks are sold to raise money for a company.In order to launch an ICO, a company simply needs to create a website, issue a token, and set a time and date for the sale. Investors buy ICO tokens in exchange for another cryptocurrency, like Bitcoin or Ethereum; after a set amount of time, they receive the tokens they purchased in the sale.Acco Read this Term).

According to the complaint registered on July 17, the Blockchain Blockchain Blockchain comprises a digital network of blocks with a comprehensive ledger of transactions made in a cryptocurrency such as Bitcoin or other altcoins.One of the signature features of blockchain is that it is maintained across more than one computer. The ledger can be public or private (permissioned). In this sense, blockchain is immune to the manipulation of data, making it not only open but verifiable. Because a blockchain is stored across a network of computers, it is very difficult to tamp Blockchain comprises a digital network of blocks with a comprehensive ledger of transactions made in a cryptocurrency such as Bitcoin or other altcoins.One of the signature features of blockchain is that it is maintained across more than one computer. The ledger can be public or private (permissioned). In this sense, blockchain is immune to the manipulation of data, making it not only open but verifiable. Because a blockchain is stored across a network of computers, it is very difficult to tamp Read this Term-based company sold more than $400,000 unregistered securities from New Jersey in the form of PINNS tokens.

The state’s Attorney General’s office and the New Jersey Bureau of Securities have filed the legal complaint against the company along with its president Sarvajnya G. Mada.

“Our securities laws apply to anyone offering or selling securities in this state, regardless of whether those securities are purchased with U.S. dollars or virtual currencies, and regardless of whether they are distributed in certificated form or through blockchain technology,” Gurbir S. Grewal, New Jersey’s Attorney General, said.

Crackdown against unregistered securities

The lawsuit alleged that the company violated the state’s securities law and sold the tokens to 217 investors, only 11 of whom submitted their documentation for being accredited investor. It further alleged that Mada acted as an unregistered agent, further violating the state’s laws.

“The lawsuit we filed makes it clear that individuals selling cryptocurrency-related investment products in New Jersey must comply with the law or face serious consequences,” Grewal added.

The company received funds in Ether from the investors and was aiming to raise up to $46 million by selling 30 million PINNS tokens.

“By failing to take reasonable steps to verify that purchasers were accredited investors capable of bearing the increased risks associated with unregistered securities, the defendants violated the law and exposed investors to financial losses that could have been devastating,” Paul Rodríguez, acting director of the Division of Consumer Affairs, said.

Meanwhile, the Securities and Exchange Commission (SEC) is also in a constant pursuit for unregistered tokenized securities offerings and shady projects. In May, the agency sued the owner of iPro Network for making false claims while raising $26 million.