The ghosts from the past are now staring at Thor Technologies and its principal members after the U.S. Securities and Exchange Commission (SEC) filed a complaint for the sale of unregistered securities.
The SEC’s complaint borders on Thor’s 2018 initial coin offering (ICO), which the commission says amounted to the sale of securities. At that time, Thor Technologies realized $2.6 million from over 1,500 investors, a third of them U.S. citizens.
Named in the suit are Thor Technologies co-founders David Chin and Matthew Moravec, who are slammed with three primary infringements of securities law. The first allegation was the failure to register Thor tokens with the Commission, while the second hinged on marketing the tokens as an investment.
“As the network grows, we expect the value of each token to increase as usage of tokens drives demand given their scarcity in a finite pool of available supply,” read Thor’s whitepaper.
The third violation of securities laws is the failure to register the offer and sale of Thor tokens with the commission. Other ancillary offenses include the absence of proper disclosures on Thor’s financial condition, ability to generate profits, and other necessary factors that would assist investors in deciding whether or not they would invest.
“Thor never filed a registration statement with the SEC with respect to any Thor Tokens it offered or sold, and no registration statement has ever been in effect with respect to any offers or sales of Thor Token,” read the filing.
The commission seeks to disgorge Thor and its founders of “unjust enrichment” while praying the court to order the defendants to pay civil monetary penalties. Furthermore, the SEC wants to permanently ban the defendants from participating in the offer and sale of securities in the form of digital assets.
The SEC is doubling down on efforts to regulate the ‘cryptoverse’
The Gary Gensler-led SEC has been on a campaign against erring firms in the digital asset industry as it attempts to sanitize the sector. With multiple cases in court and a streak of settlements under its belt, the SEC shows little to no signs of hitting the breaks.
Recent cases like the charge against Sam Bankman-Fried over his role in defrauding FTX investors and the call for public companies to disclose their exposure to digital assets have been hailed by pundits as a step in the right direction.
“Companies may have disclosure obligations under the federal securities laws related to the direct or indirect impact that these events and collateral events have had or may have on their business,” said the Commission.
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