Crypto Company Unicoin Suspected of Defrauding Investors

The US Securities and Exchange Commission (SEC) has filed a lawsuit against crypto company Unicoin and three of its executives, accusing them of massively defrauding investors and illegally selling securities related to digital assets.

The SEC alleges that Unicoin spent several years running a massive campaign to promote investment products that would supposedly be backed by billions of dollars in real estate, stakes in companies preparing for IPOs, and other real assets. According to the regulator, the company claimed to have raised more than $3 billion, but actually raised no more than $110 million. It also placed ads in airports, New York City taxis, on TV, and on social media to lure more than 5,000 investors.

"These promises were false. Investors thought they were buying collateral for future tokens, but in reality they were buying unsecured obligations," an SEC official said.

In turn, Richard Devlin, Unicoin's legal counsel, made a deal with the SEC and agreed to pay a $37,500 fine without admitting or denying the charges. The commission demanded that the platform pay damages (including illegally raised funds), pay legal costs, and impose administrative fines on all parties involved. The regulator also wants to prohibit the defendants from issuing and selling securities in the future.