The SEC today filed cease and desist proceedings against Digital Currency Group (DCG) and fined the company $38 million. The agency further fined former Genesis CEO Soichiro “Michael” Moro $500,000.
This is potentially the SEC’s final enforcement action before Gary Gensler resigns next week.
The SEC finally settles with DCG
Digital Currency Group (DCG) has suffered major setbacks over the past year, but this new round of lawsuits from the SEC is complicating matters. Today, the Commission filed a cease and desist request order against DCG as a whole, as well as a second order specifically censuring former CEO Michael Moro.
“The Commission considers it appropriate and in the public interest to impose the sanctions agreed in Digital Currency Group’s offer. Accordingly, it is hereby ORDERED that… (DCG) cease and desist from committing… any violation… of the Securities Act (and) pay a civil penalty in the amount of $38 million,” the court asserted. SEC in its filing.
The SEC fined Moro $500,000 and accused him and DCG of misleading investors. None of the Commission’s documents on the case mention criminal sanctions for these offenses, but they serve as a stark warning.
It is nevertheless important to note that ETF analyst Eric Balchunas called this effort is a “last hurray”. Outgoing SEC Chairman Gary Gensler has maintained his enduring distance from the crypto industry, even though his term will end in two days.
Ripple CEO Brad Garlinghouse recently criticized him for dragging out a case with the SEC, and it appears he is launching a new attack on DCG.
In other words, it’s impossible to tell where the SEC-DCG feud will be even a week from now. Its commissioners are actively preparing for a new pro-crypto environment, and that includes slowing down prosecutions. This decision may ultimately be little more than one last tantrum.
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