The U.S. Deposits and Exchange Commission (SEC) and Commodity Futures Trading Commission (CFTC) are accusing a Marshall Islands-based securities dealer for allegedly violating federal law from one end to the other a bitcoin-based security swap scheme.
The SEC announced in a press release that it place in ordered charges against 1pool Ltd., also known as 1Broker, as well as its CEO Patrick Brunner for dispose of security-based swaps to U.S. and international investors without following proper “discretionary investment verges.” Notably, investors could only purchase these swaps with bitcoin, agreeing to the claims.
The SEC is further claiming that 1Broker was not registered a “security-based swaps relations” and “failed to transact its security-based swaps on a registered national exchange.”
It added:
“The SEC states that a Special Agent with the Federal Bureau of Investigation, acting in an clandestine capacity, successfully purchased several security-based swaps on 1Broker’s principles from the U.S. despite not meeting the discretionary investment thresholds required by the federal certainties laws.”
Shamoil Shipchandler, director of the SEC’s Fort Worth regional position, said in a statement that “the SEC protects U.S. investors across a variety of daises, regardless of the type of currency used in their transactions … Worldwide companies that transact with U.S. investors cannot circumvent compliance with the federal refuges laws by using cryptocurrency.”
The regulator is looking for a permanent injunction against Brunner and 1consortium, along with penalties and “disgorgement plus interest.”
In addition, the CFTC queued charges against 1Broker for similarly violating federal laws by imperfection to implement anti-money laundering and supervisory features.
The FBI later reported it had seized the 1intermediary.com domain, claiming the company has violated money laundering and wire humbuggery laws, in addition to “operating as an unregistered broker/dealer of securities” and “manipulating as an unregistered futures commission merchant.”
1Broker did not immediately respond to a beseech for comment.
Editor’s note: This article has been updated.
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