NJ blames Pocketinns for Violating Securities Laws

NJ blames Pocketinns for Violating Securities Laws

The US state of New Jersey filed a lawsuit against the online marketplace Pocketinns for selling tokens in violation of securities laws.

New Jersey Attorney General Gurbir S. Grewal and the Bureau of Securities announced that the state is suing the company of its president Sarvajnya Mada for distributing more than $ 400,000 of unregistered securities. PINNS token sales.

According to the announcement, Pocketinns sold tokens for ETH through the pre-sale of tokens (ITO), but neither the company nor Mada registered with regulators. The sale took place from January 15 to January 31, 2018. 217 investors confirmed that they bought PINNS tokens “in violation of the New Jersey State Securities Law.” The state complaint claims that the firm hoped to raise up to $ 46 million through the sale of up to 30 million tokens.

It is also alleged that Mada acted as an unregistered agent, and, accordingly, Pocketinns hired an unregistered agent, which is also against the law, the General Prosecutor’s Office said in a statement. Grüal said:

“Our securities laws apply to anyone who offers or sells securities in this state, regardless of whether these securities are purchased for US dollars or virtual currencies, and regardless of whether they are distributed in certified form or by blockchain. The lawsuit that we filed makes it clear that individuals selling investment products associated with cryptocurrency in New Jersey must abide by the law or be prepared for serious consequences. ”

The complaint also alleges that the defendants sold the tokens without registering with the Bureau on the basis of a federal registration exemption, requiring that those involved in the sale were accredited investors.

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“However, Pocketinns and Mada did not take reasonable steps to ensure the accreditation of investors, which led to the non-applicability of this rule and required the registration of PINNS tokens with the Bureau of Securities,” the staff said.

According to the complaint, only 11 out of 217 investors who acquired PINNS tokens provided documents confirming that they are accredited investors.

The state of New Jersey seeks to permanently ban Pocketinns and Made to sell securities in the state, and also proposes to impose administrative sanctions against the accused. The state also requires that they return funds to investors involved in the sale.

Despite the fact that American regulators have repeatedly accused cryptocurrency companies in violating securities laws, recently government officials have begun to meet the industry. Last week, the US Securities and Exchange Commission (SEC) approved
a public offer of Blockstack startup tokens worth $ 28 million, as well as the release
tokens by Props.

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