U.S. SEC Files Charges Against Bitcoin-Backed Securities Dealer 1pool

The United States Securities and Exchange Commission has filed charges against Bitcoin-backed securities dealer 1pool Ltd., for allegedly violating federal securities laws.

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The United States Securities and Exchange Commission has filed charges against Bitcoin-backed securities dealer 1pool Ltd., for allegedly violating federal securities laws.

SEC Files Charges against 1pool Ltd.

1pool Ltd., a Marshall Islands-based corporation is facing charges filed by the SEC, who alleges the company violated federal securities laws by offering Bitcoin-backed security trades.

The SEC published a press release of September 27, stating that 1pool Ltd. was involved in Bitcoin-funded security swaps.

The court case involves 1pool Ltd., which provides cryptocurrency-related services and stands behind 1broker.com, and its Austria-based CEO Patrick Brunner.

Multiple complaints filed against 1pool Ltd. and 1broker.com

1pool Ltd., 1broker.com, and CEO Patrick Brunner are facing multiple complaints filed by the SEC, the Commodity Futures Trading Commission (CFTC) and the Federal Bureau of Investigation (FBI).

SEC

The SEC filed their complaint with the U.S. District Court for the District of Columbia. The watchdog agency is seeking permanent injunctions, disgorgement plus interest, and penalties on the parties involved.

In its report, the SEC explained that investors could open accounts with only an email address and a username with, without submitting the necessary information to comply with AML/KYC regulations. From there, individuals could fund their account using Bitcoin.

Furthermore, the SEC alleges that Brunner and 1broker failed to perform its security-based swaps on a traditional exchange registered in the U.S., as well as failing to properly register the firm as a security-based swaps dealer.

Shamoil T. Shipchandler, the director of the SEC’s Fort Worth Regional Office, commented on the complaint stating that:

“International companies that transact with U.S. investors cannot circumvent compliance with the federal securities laws by using cryptocurrency.”

FBI

According to the complaint filed by FBI, a Special Agent with the Bureau acting undercover stated that he purchased security-based swaps on 1broker’s platform in the United States.

FBI’s complaint arises from the Special Agent’s ability to disregard the discretionary investment thresholds required by the federal securities laws when purchasing securities.

CFTC

On the same day, the Commodity Futures Trading Commission (CFTC) filed a civil enforcement action against 1pool Ltd. and Brunner, stating that the firms violated the Commodity Exchange Act of the United States.

The SEC’s battle with crypto

Recently, the SEC has increased its attention towards crypto projects. This week, the SEC announced it is seeking extra sanctions against the organizers of the alleged fraudulent Initial Coin Offering of PlexCoin.

Earlier this month, the agency issued a cease and desist order and a $200,000 fine on Crypto Asset Management and its founder Timothy Enneking.

Shamoil T. Shipchandler is quoted saying:

“The SEC protects U.S. investors across a variety of platforms, regardless of the type of currency used in their transactions.”

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